Peer-to-Peer Equipment Rental Apps Gain Steam
Idle construction equipment costs money. Not just in maintenance but also in the lost revenue from not putting it to work. Small contractors with a few pieces of iron or big firms with massive fleets often eat the cost of idle equipment or set up handshake deals to lend it out for a fee. But a few ambitious tech startups are taking this informal economy online with free mobile-based equipment-rental apps.
"It's about helping the contractor make money and save money," says Willy Schlacks, who co-founded the peer-to-peer rental startup EquipmentShare with his brother Jabbok Schlacks. Based in Columbia, Mo., EquipmentShare lets contractors in the Midwest list equipment, get price quotes and arrange rentals. He notes, "Rental costs are a fairly large pain point for contractors." Schlacks says their prices are usually 30% below the going rental rates. "At first, some customers don't want to rent their stuff out, but we can analyze their asset utilization and show they're losing money on idle machines." EquipmentShare also tracks telematics data on equipment through its tracker devices, keeping users up to date on performance histories.
Not all rental apps focus on contractor-to-contractor deals. Getable is an app designed to better connect contractors to existing rental firms. "We facilitate connections between contractors and suppliers," says Tim Hyer, Getable CEO. "Not just to suppliers they haven't worked with before, but also setting up new connections in long-standing business relationships." Like other rental apps, Getable asks renters and owners to rate each other after a deal. But Getable focuses more on building detailed profiles of supplier performance. "We let people rate things like response times, on-time delivery, pickup times—we let both sides rate the experience in detail," says Hyer. "You may already have good relationships with suppliers in your own region, but if you're expanding into a new city, we want to be able to showcase the best suppliers in that area to you."
San Francisco-based Yard Club asks that its members ante up some of their own iron for rent before they join up. "We focus more on heavy, earthmoving equipment and have pretty strict standards on what can be listed on the site," says Colin Evran, Yard Club CEO. He says they have about $200 million in heavy-equipment assets listed in the app today and are planning to expand beyond California. "Our primary feedback from users so far is that they want high-quality equipment—this isn't a race to the bottom on price," he says.
On May 7, Caterpillar announced it will provide strategic financing to Yard Club and will use the app in its own rental business. Greg Foley, Caterpillar vice president for its newly formed analytics and innovation division, sees it as a natural step for the company. "With all of the advances in peer-to-peer technology going on around us, we asked ourselves, why shouldn't our customers have the ability to share assets to increase efficiency and lower the cost of ownership?"
