How can an equipment rental company get more value from its assets? Based on many years of working in the oilfield services industry, VistaVu Solutions President Jory Lamb has some proven ideas to offer.
He recommends that rental companies consider VistaVu’s 10-Point Process for Managing Rentals More Profitably.In this report, you'll hear us talk about:
1. Seek visibility. The best rental companies always know where all their equipment is. In Lamb’s view, real-time visibility of capital assets is the key to successful rental management.
2. Win your shipping wars. If a piece of equipment is being shipped from one place in Oklahoma to another, there’s no point bringing it back to Dallas in between. Can you arrange this? If you received a rush order, could you turn a truck in a new direction?
3. Manage maintenance. “A good maintenance program walks a fine line,” says Lamb. “Customers expect equipment to be well-maintained but the rental company wants to maximize usage. You need a system that can strike the right balance.”
4. Monitor permits and qualifications. Nothing runs without proper permitting and a qualified operator on board. Tracking regulatory requirements by paper is asking for trouble. The most profitable rental companies do it electronically.
5. Know what’s making you money. What are your most profitable types, makes and models of equipment? “Top-performing rental companies know this information,” says Lamb, “and they use it to make their own purchase decisions.”
6. Benchmark your breakdown rate. Production companies may demand a figure for your mean time between tool failure. This figure should be accurate and available.
7. Manage your distributed geographies. It’s important to know not only the status of equipment in your own location, but every piece of equipment in every location the company operates.
8. Master flexible pricing. You may price your rentals by day, week or month but how easily can your system accommodate, say, a 22-day rental and how would you price it?
9. Beat low margins with high efficiency. Some rental items are price-sensitive commodities, and the only way to be profitable is to be efficient. “We know a company that rents out mats, and has 25,000 of them,” says Lamb. “Their competitive advantage is their ability to get the mats where they’re needed, fast.”
10. Do more with less. As a rental company gains more visibility and control, it may find it has more equipment than it actually needs. If so, sell your surplus or delay new purchases.
Says Lamb: “One VistaVu customer rents out batteries and over a two-year period, they increased revenue by 30% while reducing their inventory by 25%. That’s the kind of impact that asset visibility and control can have on a rental company.”
To learn more, check out the full report!
