A remarkable 93% of professional contractors rented equipment in the past year, according to the 2019 Rental Customer Needs Study conducted by the American Rental Association. Of study respondents who rented, 92% planned to rent as least as much as last year, and 52% expected to increase renting over the next year.
The equipment rental industry is growing and changing right along with the businesses that increasingly depend on it. Following are five construction equipment rental trends to watch for in 2020.
1. The Shift to Rental Continues
In the wake of the financial crisis, the construction industry moved away from equipment ownership and toward equipment rental, which has proven to be enduring rather than just a short-term solution to an economic problem.
The ARA Rental Penetration Index, which measures the percentage of the total equipment fleet currently owned by rental companies, has stayed near 53% since 2013 after breaking the 50% mark for the first time in 2011.
The index suggests that contractors are seeing the ability of rental to help them:
- reduce capital expenses;
- get exactly the equipment they need;
- supplement equipment to extend a fleet and compete for more jobs;
- ensure equipment has the latest safety features and emissions-compliant engines;
- experience the convenience factor of delivery;
- enjoy confidence that the equipment is well-maintained; and
- eliminate or decrease the need for storage.
Rental is an original sharing economy—a concept that includes newer companies like Uber and Airbnb—and the migration to rental is driven in part by the younger generation coming into the construction business. Attitudes toward renting instead of buying do not show signs of changing anytime soon.
2. Technology Is Enhancing the Rental Experience
As rental customers increasingly expect progressively more convenient, round-the-clock service, rental stores are incorporating more technology into both the way they operate and their equipment fleet offerings.
From the initial online search, the rental process is easier and more efficient through mobile-friendly website designs, online booking and portals, as well as texting programs. Telematics systems on equipment are helping rental customers maximize productivity by tracking fleet location, utilization rates and service needs.
3. Rental Stores Are Educators on New Safety Standards
Modern equipment, such as mobile elevating work platforms, introduces complex safety requirements and demands that rental companies and contactors have specialized knowledge and training to use it properly. Complying with detailed regulations such as the recent silica dust rule also requires detailed expertise.
Rental stores are embracing the responsibility of educating and training contractors on the new requirements and safety features. ARA provides members with a wealth of educational resources related to the new standards, and companies regularly take part in equipment training and demonstrations with manufacturers.
4. Rental Is Mitigating the Labor Shortage
The construction industry is experiencing a significant skilled labor shortage. Many rental stores help ease the effects on contractors by providing equipment maintenance and transportation support.
Rental leaders understand the labor issues they share with their construction counterparts, and they are working alongside contractors nationwide to raise awareness about the rewarding careers available in the rental and construction industries.
5. Women Are Helping to Advance the Rental Industry
Thousands of women help make up the equipment rental industry, holding positions from mechanics to CEOs. According to ARA research, 27% of attendees at The ARA Show™ in 2018 were women, and 32% of 2018 Leadership Conference attendees were women.
To help empower women and build their collective voice, ARA has created the group Women in Rental, which provides networking, mentorship and educational opportunities with the goal of increasing volunteerism from women on a local, regional and national level. It is anticipated that more women will join the industry as the younger generation becomes aware of the rental career option and is able to take advantage of mentorship opportunities.
