Realizing Potential in International Rental
As rental companies grow, they become multi-lingual, multi-currency and often offer their services across multiple time zones too. Doing business globally can be a logistics challenge. With customers and equipment in various locations with varying rental lengths, supply chain management has never been more important. Late delivery or unavailability has a financial impact on customers and, in turn, their customers too. With a strong demand for more, better and now, there is little doubt that the rental market has great potential. But how can companies profit from growing demand without falling prey to the pitfalls?
Challenges and Opportunities
Inevitably, multi-faceted companies have multiple IT systems to deal with the diversity and variability of their business. Larger companies have grown through acquisition, which probably means inheriting a jumbled IT architecture. These are often rich in functionality because they have grown over time, but tend to function as silos and are difficult to integrate across the organization.
These disjointed systems are also making it difficult, if not impossible, for rental businesses to gain an overarching view of worldwide availability. Aspects, like managing their order lifecycle and control over the initial inquiry by a prospect to sending out invoices and collecting money consistently and efficiently, become and increased challenge. Rental companies are looking towards ways of bringing together multiple systems that provide integrated, reliable, current and easy to access information, that is tailored to their own processes and workflow.
Regardless form wich location or country employees are working from, the business processes should be largely identical. Documents such as invoices need to be in the appropriate languages and use of different currencies needs to be consistent and standardized. Rental companies may sometimes find they are investing too heavily in buying new equipment to hire out, simply because they find it challenging to keep tabs on where their existing assets are across the globe and whether they can be transferred in time. Having visibility across all assets allows one to ensure that equipment is maintained to higher levels of preparedness. This results in shorter delivery times for customers as well as making it easier to move equipment across the globe to better match immediate demand. It, therefore, helps to save on Capital expenditures (CapEx) by avoiding the need for more equipment to be purchased.
For an international equipment rental company, working across different time zones means that there is a lapse of insight on utilization and, thus, difficulty in understanding the current state of their business. If one can achieve that all the data across all geographies is reflected in one time zone, users can view this consistently from every location, whether a hire begins at 3 AM UTC in Singapore or at 10 AM in Brazil.
Technology can also help release so-called hidden equipment. Equipment can be held in warehouses and kept in an ‘under repair’ status so that it does not appear available to rent out. A modern IT systems is able to show how long objects are held at this status and these timings can be linked to warehouse KPIs. This can usually help to ensure they are back in circulation sooner. This further helps to increase utilization levels. In fact, having a central source of real-time information can help ensure all equipment is returned on time and support financial planning. The sales team can then proactively call their contacts regularly, who see this simply as great customer service. In time, they save up their requirements in anticipation of the call, as it’s far easier for them to give the business to someone they already know than have to make calls to take it elsewhere. In other words, the rental company has made more friends, and more money, by having an overview of everything that’s due to be returned.
A modern rental solution also makes it easy for rental firms to introduce an element of CRM to keep track of prospects and to price and quote individually to potential and existing customers. Because an order may be made up of many different components, particularly it may go through many iterations before everything on it is ordered and delivered. Automating processes for project rental can dramatically cut the time taken to do this, as well as increase accuracy and thus margin.
Some of these improvements may seem relatively small, but they all illustrate the importance of being totally on the ball when it comes to the current state of play across an entire organization.
Taking the Next Step
In our view, the rental industry has an extremely bright future. However, promising prospects usually lead to increased competition. Only those willing to optimize their use of technology will be able to cut through the complexity to maintain and grow their profitability.