7 Key Equipment Rental Questions for the Savvy Construction Executive
Today’s fast-paced construction landscape faces many challenges—rising material costs, the skilled labor shortage, increasing competition and shrinking profit margins are just a few. Adding to the challenge is the need for builders to stay on top of rules and regulations such as safety codes, building codes, tax codes and more.
With an expected construction growth of almost 4% this year alone, it puts even more pressure on construction executives to find smart, cost-effective solutions for everyday business challenges.
Technology is Changing Everything
The construction industry has long held the reputation of being late to adopt technology. But the post-recession construction boom—coupled with the integration of technology into our everyday lives—has changed the way contractors work. In order to stay competitive, construction and engineering firms today are embracing technology in every aspect of their operations.
Shortened project schedules, a challenging labor market, and increased insurance and certification costs all factor into the equation. Savvy construction executives recognize that it is imperative for companies to seek and implement technological tools that advance productivity, enhance safety measures and increase margins for greater profits. They are always looking for a streamlined process that capitalizes on the resources they have and still achieves their needed results.
“The construction industry is starting to fully embrace technology across many aspects of the project—from procurement to execution,” states Nick B., project manager at a national stucco company. “The change is about convenience. Online technology, via varying devices, is taking over the industry.”
Challenges to the Traditional Rental Process
Anyone who has been responsible for handling the equipment rental logistics for a project is familiar with the shortcomings of traditional methods for finding rentals.
- SEVERAL PHONE CALLS: Securing rental equipment usually requires making several phone calls to find the equipment needed during specific time slots. This often includes working with multiple rental companies for one jobsite.
- ABRIDGED VETTING PROCESS: If working outside of your region, you may not be familiar with local companies. This means you must use an online search to secure equipment with an unfamiliar company in order to keep the project moving on schedule.
- ADDITIONAL LOGISTICAL ENERGY: When securing rental equipment from new and/or multiple sources, you need to dedicate more time to internal logistics. Rental companies often require additional paperwork and credit checks before renting to a new customer. If you are renting from multiple sources you need to have a well-organized system in place to keep track of contract terms, equipment tracking and account reconciliation to process payments.
In some instances the needed equipment is simply not available via the standard means and normal efforts. This problem has become more widespread as the construction industry has seen a tremendous uptick over the last few years—and is expected to grow more.
The bottom line is: There simply is not enough equipment available in certain localities at certain times.
However, as more construction firms are electing to use single-source equipment platforms and networks, and as increasingly more equipment providers are partnering with those providers, it is evident that the industry is moving in a direction marked by faster and more efficient solutions in the equipment arena.
The Evolution of the Construction Rental Marketplace
As the pace of the construction industry increases and spending continues to grow—amounting to $176.3 billion in the first two months of 2018, a 1.3% growth from the same time period in 2017—the construction rental market will continue to evolve. Because of this pace, contractors are seeking swift solutions to sourcing the equipment they need — and they are finding it online.
“In the past, sourcing was built upon relationships with salesmen and a quality product,” explains BigRentz CEO Scott Cannon. “The world today is based more on convenience of access to product selection, speed of procurement and ease of payment. The importance of human interaction and relationships development is dwindling since everything is done via an app or on the web.
“What is happening is indicative of how business practices are changing across the spectrum and how people are feeling more comfortable renting online,” states Cannon. He notes that approximately 30% of BigRentz business is a “touchless rental”—where the entire rental process is automated with no personal interaction (by phone or in person), only personal oversight to assure quality.
This self-service technology allows a contractor to order equipment, extend or terminate the rental, report any issues and manage invoices—all online accessible by mobile, tablet or desktop computer. BigRentz sees this “touchless rental trend growing to 45% to 55% by 2020.” Cannon claims that this method of securing rental equipment drives a better customer experience due to greater efficiency, fewer errors and more cost effectiveness all around.
Choosing an Equipment Rental Source: 7 Questions to Ask
While consumers have embraced the use of online booking tools for a decade or more (think Hotels.com, Expedia.com), these tools are quite revolutionary for the construction industry. As project schedules are condensed, geographical territories increase and profit margins become tighter, online solutions have become a welcomed addition to the project management process for many in the field.
But choosing a single-source equipment rental option can be tricky because your entire project schedule and operation hinges on the right working equipment being there at the right time and invoiced at the agreed-to price. There shouldn’t be any surprises.
Here are seven questions to consider when selecting an equipment rental source.
QUESTION 1: DOES THIS PROCESS SAVE TIME?
Technology makes it easier than ever to communicate with everyone involved in a project—owners, project managers, subcontractors and suppliers. But some technology solutions, even with the best intentions, can be cumbersome and complex to use, which makes it difficult to secure the resources you need.
As a specialty construction company owner, Nick is engaged by many large construction firms across the U.S. “What I hear often from most contractors is that they are seeking more and better software, apps and other technology tools to help them increase profits and efficiency.”
For a construction firm to have success with a newly adopted tech tool, such as an online rental source, it needs to ensure that the adoption of that tool will allow the entire operation to be more productive and will eliminate the hassle and the legwork of shopping around. Nick adds, “I think that when a company, like BigRentz, can alleviate some of the hard work of chasing down equipment that I would do as a project manager, that’s a plus.”
QUESTION 2: IS THERE A DIVERSE SELECTION AND LARGE POOL OF EQUIPMENT?
Working with a national single-source rental platform can be an ideal solution because it is set up, by design, to have a large selection of equipment and broad coverage area because it pulls from multiple suppliers. Calling on one source allows the construction company to secure hard-to-find pieces of equipment no matter the location.
Keith Holmes, vice president of Operations for BigRentz, has seen the enormous growth in suppliers electing to become part of the BigRentz network. “When I started here in 2014, we had about 50 suppliers in our rental network. Today we have over 1,600.”
The suppliers affiliated with a single-source rental marketplace also see benefits as they gain efficiency and revenues because they are able to make better use of what was once idle equipment.
QUESTION 3: IS THE RENTAL PROCESS EFFICIENT FROM END TO END?
In order to save time and increase productivity across your entire operation, you’ll want an online equipment rental platform that is robust. This means it serves a large geographical area and delivers the equipment you need when you need it. But you’ll also want to look for a rental company that provides an all-inclusive solution. This includes:
- Onsite Services
- Lift Termination
- Invoicing & Close Out
Additionally, look for a rental source with location-specific rates and equipment specifications online anytime—without having to call during “normal business hours.”
QUESTION 4: ARE THE TOTAL COSTS COMPETITIVE?
We all understand there is a price for renting a piece of equipment, such as a lift, and there is the larger cost of doing business. A single-source rental marketplace has the leverage to provide competitive pricing on equipment rental costs across the country—with all fees clearly laid out and no surprise charges. There is a real value in working with one source that has better control over your total cost.
Whether you are constructing in a big city or rural area, a rental source should be able to deliver a competitive rate based on a large, nationwide network and also be able to fulfill your needs—even during the height of construction season.
QUESTION 5: DOES IT PROVIDE ACCURATE EQUIPMENT SCHEDULING AND REAL-TIME UPDATES?
While we live in an economy where consumers are willing to “help themselves,” they still need to have the confidence in the service they are using. Project managers need a tech tool that allows them to place the order 24/7 and has the assurances that the right equipment will be at the jobsite as scheduled. Equally important are real-time updates online or via mobile device that show the number of days y left on the rental agreement—so you can plan to extend or terminate easily and conveniently. Nick adds, “This is a huge benefit for my company—large specialty contractor that does projects across multiple states—that I have a single account.”
QUESTION 6: IS TRACKING JOB COSTS ACCURATE?
Back-end office paperwork can bog down the momentum of an operation, yet it is the daily and weekly reports that keep your profits on track. Many contractors are turning to online technology integrations to keep tabs on materials, safety and job costs—part of that equation is rental equipment.
When you select a single source for all of your rental equipment needs, you can quickly access these costs to help provide an accurate picture for job cost tracking.
Additionally, for decades it has been commonplace for contractors to use Net 30 Day credit terms, but today more contractors are seeking companies that allow online credit card payments to keep the flow of projects moving. This can all happen within a single-source platform.
QUESTION 7: DOES THE RENTAL SOURCE VET SUPPLIERS ON YOUR BEHALF?
A contractor needs to have the confidence that a supplier is reliable, dependable and provides quality equipment that won’t break down or cause delays on the jobsite. For example, rental suppliers within the BigRentz network have been vetted and are assumed to be the top performers in the industry. A rental source should regularly track criteria like late deliveries, equipment failure, service calls and invoicing issues in an effort to solely align themselves with quality outfits and branches.
The Ongoing Construction Industry Revolution
The most successful construction firms are embracing technology in all aspects of their operation because they recognize the many benefits: increased productivity, streamlined project management and ultimately larger profit margins. Securing rentals of heavy construction equipment should be no different.
“Technology in product procurement will continue to grow,” says Cannon. “The equipment rental business is going online because the world is going online.”
BigRentz is an online construction equipment rental marketplace. Our 1,600+ rental partners and 8,000+ partner locations represent the biggest equipment rental network in the nation. We use innovative technology to streamline the rental process and simplify the procurement and logistics challenges of renting construction equipment. Types of rentals available include aerial lifts, forklifts and material handlers, earthmoving equipment, compaction equipment, and site services to customers in a variety of industries. Visit www.BigRentz.com.
Vice President of Marketing at BigRentz
Jim Arabia is a marketing and branding executive with over 20 years of experience leading businesses with growth initiatives. In his role as Vice President of Marketing, Jim’s responsibilities include leading market positioning strategies, creating programs to align and support the strategic vision, and directing the activities of the brand advertising efforts. BigRentz.com.