Becoming a Point of Rental: Offering the Right Tools for a Job
Today, you can rent just about anything from a prom dress to a power tool. That means businesses, especially hardware stores, should seriously consider increasing their product offerings with a point of rental system.
Hardware stores are already in the tool business, so taking the next step and renting specialty tools, power tools, or even construction equipment isn’t a drastic step. And getting into the rental business can do many things for a business. It can:
- Create new markets.
- Expand your offerings.
- Help you sell products.
- Improve customer loyalty.
- Turn your store into a rental destination.
Profits for Rent
In a recent forecast, the American Rental Association (ARA) expects equipment rental industry revenue to grow steadily to approximately $59.6 billion by 2021. General tool rental is a $5 billion annual industry by itself and it is expected to grow by 5.9% this year, 7.8% in 2020 and 6.7% in 2021.
Along with that growth comes more opportunities and jobs. The Bureau of Labor Statistics projects steady growth in rental industry employment through 2026.
All this means there are big bucks on the table for rentals and most hardware stores are already equipped with the right customers, equipment knowledge and infrastructure to support a rental department.
Hardware stores are extremely flexible businesses with many offering niche products, so it’s not a big step for many of them to go from selling specialty products to renting them. Here are some long-time rental markets and others that are “trending.”
Tools – Ladders, scaffolding, saws, tile cutters, reciprocal, jig and table saws
Construction equipment – Everything from excavators to orange safety cones.
Landscape equipment – Rototillers, broadcast spreaders, post hole diggers, riding mowers.
Carpet cleaning – Machines, chemicals and accessories.
Party supplies – Tables, chairs, heaters, tents, all the way to food service.
Boats – Fishing, water skiing or pontoon boats are all popular rentals.
Bike rentals – Mountain and road bikes are established rental markets. E-bikes and scooters are trending and are currently big hits for alternative transportation in tourist spots.
Water sports – Tubes, kayaks, skis, surfboards or stand-up paddleboards.
Outdoor gear – Fishing, hiking, camping, rock climbing and four-wheeling equipment.
Hunting equipment – Scopes, blinds and binoculars.
Gas cylinders – Not everyone who needs to cut or weld something wants to store acetylene tanks in their garage.
Log splitters – These are especially popular in cold weather climates or summer camping areas.
Finding a niche popular with your current clientele can endear your business to them even more, and it can draw in new customers. Rental markets are often regional or seasonal in nature. Snowblowers and log splitters are popular in cold weather climates, but they would gather dust in the southern states and the southwest. Businesses need to cater their rental offerings to their customer’s needs.
“It’s all part of being a complete store for the community, and rental plays its part in putting that whole image together,” Greg Kuball, CEO of Kasson Hardware Hank, tells Hardware Retailing.
Just like fashionistas buy earrings, bracelets and shoes to go with a new dress, do-it-yourselfers buy products to go with their rental equipment. What good is a floor sander without the sanding pads, masks, goggles and more? A tile cutter isn’t much use without the tile, and a paint sprayer needs paint and a host of accessories. The possibilities are endless.
Some rental equipment provides its own markets. Hardware stores are a natural source for carpet cleaning rentals. Stores can score additional sales beyond renting the machines and selling the chemicals with other floor cleaning and servicing items like tile cleaners, brooms, mops and vacuums.
Starting a point of rental requires a serious commitment and putting together a strategy is crucial to success. The upfront investment for rental equipment can seem the most daunting, but extensive thought should also be given to costs for additional staff, equipment repair and replacement, general liability insurance, equipment storage, delivery vehicles and more.
Hiring additional employees to handle the point of rental services such as maintenance and repair is one option. Contracting out that work to local businesses which can create valuable partnerships is another. Knowledgeable employees are a valuable addition for more than just handling repairs and maintenance. They can also train coworkers and customers on how to properly use rental equipment.
There are companies today that provide rental management software that can handle most of the heavy lifting of a point of rental such as contracts, billing and invoicing, maintenance scheduling, bundling and reporting. One such company is appropriately named Point of Rental. It provides cloud-based management software that makes inventory control, contract writing and billing easy. These systems can stand alone or be integrated into a store’s retail platform.
“With rental software, you’re able to keep maintenance schedules more easily – you can load the maintenance schedule and track the hours or mileage on the machines, send out a maintenance person to take care of work that can be done on-site or send replacements before a piece of equipment needs to come back to be worked on,” Point of Rental CEO Wayne Harris explains. “It also helps with seeing what’s available throughout the organization. We see idle equipment so often on lots – sometimes another site needs that piece of equipment, but if they don’t know it’s there, they’re buying a new one or renting one, when all they had to do was transfer it between locations.”
These point of rental software solutions not only provide all the paperwork needed to run a successful department, but they also offer convenient solutions to other simple rental needs. Mobile apps allow rental associates to access delivery and pick-up information, scan barcodes and take payments out in the rental yard. Associates can also record the condition of equipment with time-stamped photographs.
Building a Rental Brand
Having the right tools for any job is one of the easiest ways to keep customers happy and coming back. A solid point of rental can turn a store into a destination for both contractors and DIYers in need of special equipment, and in doing so will help any store build business and customer loyalty.