Equipment Rental Network Looks to Fill Gaps in Supply Chain
Tracking down the right piece of equipment when you need it on short notice is a perennial source of headaches and delays on jobsites. In recent years several startups have tried to tackle the issue, with mixed results.
“There have been dozens of these startups in this space,” says Scott Cannon, CEO of online equipment rental broker BigRentz. “Most are out of business, and even we had some growth issues. But today we are the largest rental company in the United States by size and number of rental yards.”
That may be news to customers of the larger, traditional rental houses, and it’s due to BigRentz’s business model. Rather than own and maintain its own equipment and yards and compete with every other rental shop, BigRentz seeks to connect equipment owners to renters and works to expand its customer base of thousands of small and family-owned rental yards. Initially established in 2012 as a lead-generation company for rental shops, BigRentz soon assumed the role of online broker, offering an app to find equipment almost anywhere in the U.S. With over 2,000 rental suppliers and 9,000 locations, the firm does about 45,000 to 50,000 rentals per year. The paperwork and insurance is handled in the app, and BigRentz takes a fee on each rental.
“We’re still relatively small in terms of revenue,” says Cannon. “The big rental firms average $8 billion and we’re still sub-$100 million. But we’re growing 30% to 35% per annum, while the industry is only growing 5% or 6%.”
The BigRentz app is similar to many other equipment-sharing portals that have come and gone in recent years. What seems to have set BigRentz apart is its focus on up-to-date information on equipment availability.
“We’ve broken down every square kilometer in the U.S., calculated how many suppliers are in range of every location, driving distance, routing, all that,” says Cannon. “We layer in pricing, performance, every other metric you can imagine. We show the customer how we can support them where and when.” Based on these hundreds of thousands of data points, BigRentz aims to be the last-resort supplier for construction projects where equipment is needed on short notice.
The company currently offers equipment across the lower 48 states, with plans to expand into Canada in the next 18 months, with Australia and Southeast Asia on the horizon.
Targeting small to midsize contractors, BigRentz seeks to pair them with local rental shops. But even large contractors with their own fleets have found use for the company’s services. “One of the larger contractors out there, we do half a million in business with them, but they use $40 million in rental and own equipment all over the world,” Cannon says. “But still, in some cases you can’t get a track drill from Texas to Pennsylvania quickly, so we serve that.”
“BigRentz has allowed us to rent to their clients on projects that we would not have penetrated without their help,” says Adam Stegeman, sales manager for rental firm Synergy Equipment. With 16 locations, the firm has used BigRentz for hundreds of rental transactions. “Their clients are not our typical customer, so it allows us to increase our utilization and truly results in a win/win situation for all parties.”
For Cannon, whose background is in the logistics industry, his first reaction to the often paper-based and technology-averse construction rental market was a wry surprise. “At first I chuckled,” he says. “In the logistics space, it was the exact same mentality 20 years ago and [computer-based analytics] just caught fire. I think we’re in the early days for this in construction, there’s still a ways to go.”