The Top 5 Asset Management Concerns for Rental Outlets in 2015

Command Your Rental Fleet

As the construction equipment rental industry surges ahead, it is clear that alert and agile businesses will be the ones best prepared to take advantage of the new opportunities this year. New asset management technologies that provide increased visibility and flexibility are, as a result, top of mind for many rental outlets and service providers as they arm themselves to more effectively compete in this fast growing and highly competitive landscape. With this in mind, here are the Top 5 asset management concerns that rental outlets focused on construction equipment should be considering in the coming year:

1. Drawing on the Internet of Things

It is predicted that, by 2020, there will be 33 billion connected devices in the world, or 4.3 devices for every person on the planet, nearly three times the 10 to 12 billion estimated today. Soon, almost every piece of equipment along the supply chain will come equipped with embedded sensors that constantly gather real-time data about the equipment, its operating conditions and how individual assets are performing in comparison to a fleet. The information and insight available will be far beyond anything we have had access to before — rather than just reporting data, systems will be capable of anticipating problems and even suggesting solutions.

Connected devices offer enormous opportunities for rental companies in particular, as they enable the continuous monitoring of equipment, even while it is being used by customers remotely. These solutions can capture operating hours and performance metrics or even monitor for the wrongful usage of equipment through GPS-enabled sensors.

Embedded sensors are also driving the transition from preventative to predictive maintenance. While most equipment is still maintained today on a time or volume basis (e.g. the time interval between service inspections or how many kilowatt hours of energy the equipment consumes), the real-time monitoring of equipment performance, which considers factors such as operating temperatures, flow rates and energy usage, is a far better indicator of when equipment is in need of maintenance. For rental outlets, this is particularly important as it can help prevent machine breakdowns while also creating new revenue opportunities by safely re-scheduling maintenance plans to take advantage of rental demand spikes.

2. Developing a More Mobile Workforce

Another asset management concern top of mind for rental outlets is mobility. Employees need to be in the rental yard or on-site maintaining expensive assets, not stuck in the office doing paperwork. Mobile technologies are allowing rental services to boost the productivity of their workforce through new applications designed to streamline everything from financials to equipment maintenance. More than just point solutions, however, employees are beginning to expect to have the entire business process supported on ruggedized cell phones, tablets and laptops, as well as the traditional desktop.

One important consideration when looking into these mobile applications is that they shouldn’t take much effort to make them work. By that we mean they need to be self-explanatory and intuitive so that employees don’t waste too much time getting acclimated to cumbersome programs. Sophisticated mobile applications, which allow users to work the way that they live, can also help to attract and retain millennial employees who, by 2025, will account for three quarters of the workforce.

3. Take Advantage of Fleet Management Solutions

While equipment and fleet management software is nothing new, best-in-class companies are not only using these solutions for themselves, but are also expanding them to allow their customers to monitor their entire rental fleet in one solution as well. Customer-facing equipment and fleet management solutions are especially valuable for rental outlets for two reasons. First, this software allows them to deliver an even more innovative and personalized experience to their customers, an important point of differentiation in a growing but increasingly competitive industry. In addition, these solutions also offer invaluable opportunistic data that give rental companies the chance to begin to sell added value services.

In monitoring fleets together with their customers, rental outlets can offer to provide service work or see where additional equipment might help supplement an existing rental. More than just a transaction, the rental agreement becomes a dialogue between the rental company and the customer that can lead to new business.

4. Optimizing Rental Rates

It’s undeniable that the rental industry is a highly competitive one, driven by a return on assets. Rate optimization is therefore one tool that is top of mind. Rate optimization allows rental companies to develop a competitive pricing structure based on variables such as inventory, current demand, rental duration and customer spend that even benchmarks against industry-wide rates and the rates of local competitors. This allows outlets to maintain confidence that they are getting the best return on their assets as possible.

5. Benefiting from Cloud Computing

As cloud applications move past stand-alone products and into complete solutions designed to meet the needs of specific industries, more and more companies will yield to the cost savings and flexibility offered by software as a service. Cloud applications are particularly attractive for many enterprises because they offer a range of benefits including no upfront license costs, no annual maintenance costs and no hardware and running costs. Instead, it is the software vendors that are responsible for providing updated product releases and keeping data secure for their customers, all at a predicable monthly rate.

Rental outlets continuing to modernize will undoubtedly need to better monitor an increasingly complex network of suppliers, contractors, customers and partners. Cloud solutions offer a complete, real-time view of the end-to-end value chain, an essential part of developing a collaborative, consumer-centric business. In addition to this increased visibility, cloud solutions are also more flexible than on-premise applications and offer the opportunity for fast growing businesses to rapidly structure, expand and scale up operations. This malleability and visibility will be paramount to the success of businesses in the coming years, especially in the face of the ever-quickening pace of innovation.

For rental outlets, cloud computing is a particularly strong fit because most companies don’t have large IT departments and, as a result, are already used to being hosted rather than owning and managing their business applications themselves. Cloud solutions offer the opportunity to invest in even more robust applications while only paying for service on an as-needed basis.

While these technologies — the Internet of Things, mobile applications, customer-facing equipment and fleet management solutions, rate optimization and cloud computing — all offer unprecedented opportunities for rental outlets to expand their businesses and differentiate themselves from the competition in the coming year, we do want to offer one piece of advice: Don’t let all of the new data now available from these solutions overwhelm or distract you from your bottom line. It’s always important to keep a close eye on your key performance indicators and use the data points from these technologies as a support mechanism to increase transparency and flexibility to achieve long-lasting growth.

Andreas Hellstrom is the senior director of industry and solution strategy for
Infor, based in Linkoping, Sweden.