RSC Equipment Rental

Critical Issues

The economy will continue to be the main industry concern, until public spending efforts and other new projects pick up pace. Once things turn around, economic recovery will reveal a different kind of construction, as legislative and customer demands for more environmentally sustainable buildings will increase. Not only will LEED certification and similar approaches be more common, but more attention will be paid to sustainable site preparation as well.

Some of our customers are currently focusing on refurbishing projects, since hotels and other commercial properties are not getting replaced as quickly.

Current Trends

We see continued growth of equipment rental, and more sophisticated rental services like automated rental systems, on-site rental yards and web-based rental management software. GPS technology will be used more, not only to track location but also indicates when a piece of equipment is in use, what the fuel consumption is and so on. There is more demand for modern, environmentally effective rental equipment and ways of tracking and reporting greenhouse gas emissions and carbon foot print.

Looking Forward

We focus on the factors under our control-first and foremost on providing excellent customer service, a well maintained and reliable fleet, and solutions that truly meet customers' needs. We also focus on market segments that are less affected by the crisis, or are in a different phase of the economic cycle. 

Industry financial performance will improve slightly in 2010, but we believe it is going to be 2011 before many companies in the industry will start showing profits approaching those of the years immediately before 2008.

Government Compliance

The stimulus act has had some benefits to RSC. We have built environmental sustainability into our operations for years, and now offer equipment emissions tracking for each customer rental.

Additional Insights

We have long held that renting equipment is a lower cost than owning it. Now we can also see that renting is "greener" than owning, to the benefit of customers in places like California where emissions and reporting requirements are strict.

Best Practices

When the business environment changes, some customers are more agile than others in developing new types of opportunities. For instance, not a lot of new hotel projects are started, but many properties are looking at doing facelifts.

We also have great customers with whom we integrate systems and processes, so we can help them minimize consumption of rental equipment, and hence reduce their total rental cost.

Working together with vendors is another recurring theme with customers that are doing well. Analyzing the equipment supply chain together with the customer allows design of innovative equipment management solutions that drive cost out of the system, and saves much more than would shopping for lowest rental rates.

Tags: 2010 January Issue , Executive Insights