You can hire just about anything these days; any product and any service. OK, maybe that's not true everywhere, but you know what I mean. And it made me wonder. With such a wide variety of products and services available to hire, what's the perfect rental business to own or run? And what makes it so special? Of course this isn't a idle question. If you own a rental business, or you're an entrepreneur looking for a new opportunity, you'll want to be sure that your business is close to perfection. So what are the rules? What's the checklist for a successful rental business?
I have run very successful rental businesses and recently I was speaking with an entrepreneur. We were discussing a new Rental business he was considering. It was certainly different, and he wondered if I thought his idea would fly. To help him, and to explain my reservations (and I did have reservations) I decided to create a list of 10 essential challenges that he had to overcome for him to succeed. It was really useful for him. And then I took a second look at the list I'd created and realised that it could be applied to just about any rental business, anywhere. It's a list of the 10 essential challenges for rental businesses, overcome them and you'll succeed. I haven't included some things that every business needs (such as great people, a focus on customers, a clear plan and purpose, solid finances, ethics, morality, legality and 'active listening' by everyone). I wanted to keep my list very focused on Rental. And here it is, a very specific checklist for Rental businesses, my checklist for rental success.
- Know Your Customers - in established markets or new, know your customers really well. Understand their Personas; what they need, why they need it, how valuable is it to them, how often, how many. Know it and act on it.
- Differentiate - Make your offer different and recognisable in ways that you know will attract, convert and keep your Customers
- Reach Out - Create compelling communications tactics to find, connect, convince and keep your Customers. Speak to them about solving their issues.
- Buy Right - This maybe your biggest investment, choose wisely. Think about what your Customers want today and will want into the future. Consider the lifetime revenue you expect from each asset. Drive the hardest bargain; it doesn't always have to be new.
- Manage the Fleet - Keep real utilisation high; Enough stock but not too much. Maintain realistic book values, a clear investment strategy, balanced risk and reward, accurate profit reporting and forecasts.
- Perfect your Prices - Add value and revenue to reach the highest price your Customer will pay and still feel that they're getting a great deal
- Protect - Keep track of your assets, across locations, installations and contracts. Know who you are dealing with, have watertight T&C's, few aged debts and zero invoice disputes.
- Maintain - Look after your assets and those using them. Servicing, careful handling, skilled staff, training, full certification and constant quality. Remove process delays, particularly when assets are stalled between contracts.
- Dispose - Understand the revenue lifecycles of your assets and dispose at the optimum time to maximise profits. Sell quickly, at optimum prices.
- Data Data - Use systems that liberate your capability and agility. Smart systems that automatically collect and easily manage as much data as possible. Data is gold, use it!
If you can meet these Rental Challenges you'll deliver incredible results and you'll be getting close to creating your perfect rental business.
But wait .... Is that it? Is that all? For any rental business? Well I think so. Depending upon your market and your Customers some of these 10 Challenges of Rental Success will take on a different guise or prominence - but by and large this is the checklist for success in any rental business. But you have to remember that just because I've distilled it down to 10 Challenges of Rental Success doesn't make it easy to meet them. It just makes it easier to comprehend the scale of the task. Each checklist item opens a world of sub-topics - I'll be writing about these in this blog, and they are subject of my in depth sessions and consultancy.
If you are looking at some of these Challenges and think that they blend into each other, well you'd be right. This is a holistic list, each part is important and they all integrate to create success. It's true to say that I could have added different titles and grouped the topics in different ways but in the end its a mastery of them all that really counts. Put another way, being the master of 1 Challenge will not deliver your ultimate payback - but at least it will set you a journey of discovery and improvement.