There is much more going on in tomorrow’s rental business than just changing software trends. As customers choose to rent equipment, generally for specific projects where the costs can be re-billed, the dynamics of building and managing rental fleets change quite dramatically.
Because customers are renting equipment to fulfill their project requirements, you are actually trying to match equipment to the trends in their project work. With customers doing everything they can to avoid having to service equipment, you need to be on top of servicing your equipment on their job sites and in your shops.
In the interests of keeping this blog to a reasonable length, I will restrict the content to three major points; better information, mobile technology, and the Cloud.
It is pretty hard nowadays to justify having different systems for rentals, service, and financials. As soon as you try to separate any of these three, you find yourselves involved in integration projects and often the company does not have access to real-time information. Having one integrated system means real-time and better information. At the end of the day, profitability for a rental company is reached by reaching the balance between utilization and expanding the rental fleet to its optimized size. Having 100% utilization on a small rental fleet may look good on paper but it will yield substantially lower overall projects than achieving 60% on a much larger fleet.
Having better information lets you both track demand to decide which equipment to carry and efficiently manage the fleet. Achieving higher utilization is a moving target as you adjust your fleet to match higher customer demand and remove less profitable investments. A real-time, fully integrated system is the way to go.
Mobile technology is an area attracting significant attention and justifiably so. It impacts a number of areas including the shipping and return of equipment, delivery and pickup of equipment, field service, and, depending on how you define it, could be expanded to include customer rental portals. Even the use of RFID tags to track equipment going out of or coming into the yard has some possible applications. GPS systems are now capable of tracking a wide variety and cost of equipment in the field and transmitting field information that can be used to monitor equipment usage and tie into maintenance software.
While rental clerks in the office may track customer demand and process invoices, it is usually the yard and warehouse staff who are selecting the appropriate equipment and preparing it for shipping. As well, they have to deal with the return of equipment back into the rental fleet, which has invoicing and maintenance applications. These yard and warehouse users need to have real-time access to the rental software system and be able to process transactions on a real-time basis. Once equipment has been dispatched for shipment or the company has been notified that equipment is ready to return, dispatch instructions can be passed to internal or external truckers.
Mobile field applications, capable of running in a disconnected mode, can be used to track the delivery and pickup of equipment, access GPS mapping, track dispatch transactions, record safety processes, and capture customer signatures. This technology is real and available today. Service technicians can be dispatched to the field with service instructions and ability to track labor and materials to be processed against the equipment to be serviced. In some cases, the usage and status of the equipment can be communicated to the maintenance software by GPS systems attached to the equipment.
Customer portals allow customers to use computers or a variety of mobile devices to check equipment offerings, price lists, invoice history, equipment service records, equipment documentation, and request reservations.
One of the biggest areas of interest in mobile technology for the rental industry is importing telematics data directly into ERP systems. The telematics data is collected from GPS or cellular boxes on machines that monitor and wirelessly deliver data to another location. The data collected can include serial number, hours, GPS distance traveled, idle time, machine odometer, and asset ID. Recently, a reporting standard was developed to ensure that all telematics data was presented in a unified way regardless of machine manufacturer.
Rental organizations with a mixed fleet stand to gain the most from the telematics reporting standard as they can compare their equipment across multiple manufacturers. The real benefit of telematics data is that it can be imported into an ERP system of choice and used in a powerful way to analyze rental assets.
The final area to mention for this article is the move towards Cloud Computing, which allows companies to minimize upfront software and hardware investment by paying for software licenses on a per user basis, usually monthly.
There are numerous advantages to this offering including minimal hardware investment. A small company can quickly gain access to sophisticated rental software without having to invest even in a computer server. As the company grows or scales back, user licenses can be easily scaled up or down to match demand. The professionalism of most Cloud service centers typically far exceeds the quality of firewall protection, software patching, and backup services provided by in-house resources. In some cases, the Cloud service offers superior integration to other business software such as Microsoft Office or SharePoint.
On the negative side, monthly payments that never go away can seem very expensive after a few years. On average, monthly payments for two or three years match the cash outlay of a system purchased upfront for in-house installation. The temptation is view Cloud offerings as a finance contract but in truth we are talking about apples and oranges. For some organizations it makes more sense than for others. For example, if your organization has a highly professional in-house IT group and abundant server resources, the advantages of Cloud computing seem less clear. On the other hand, if your organization does not have those resources and does not want to add them, suddenly the Cloud model, which eliminates the need for a sophisticated in-house IT group makes much more sense. In conclusion, each situation is unique and should be reviewed on its own merits.
Please contact us with any questions you have.
By Malcolm Roach, CEO of Open Door Technology, provider of Open Door Rental Software