- In addition to being squeezed by rising oil prices, construction companies are also dealing with an ongoing labor shortage
- But by improving their workforce efficiency with the help of the right software, productivity losses due to lack of personnel can be mitigated
- By reducinging instances of costly errors (like double bookings and misplaced equipment), rental companies can significantly improve their profitability shortly after implementing a new software solution
Construction is one of the most labor-intensive industries in the U.S., and it’s also the industry with the fastest-growing workforce shortage. The construction industry is facing a severe shortage of skilled and unskilled workers, which means your heavy-equipment rental business will also be affected.
The Dwindling Supply of Skilled and Unskilled Workers
Oil and prices have been on the rise, and it’s well known that there is a direct correlation between rising oil prices and labor shortages.
Generally, an increase in oil prices increases inflation, reduces economic growth, and affects other sectors of the economy. In terms of inflation, oil prices affect the prices for goods made with petroleum products. We know this as a “pass-through.” This results in a shortage of the availability of heavy-duty equipment and operators to operate the heavy machinery. It’s becoming difficult for many companies to keep up with demand because of the lack of new machines or replacement parts and the availability of drivers and operators.
This lack of supply has led to skyrocketing prices for all kinds of equipment and increasing difficulty for customers in finding available rental equipment.
Quick Solutions for the Labor Shortage in Equipment Rental Companies
- Offer more competitive wages and benefits.
- Offer training and educational programs.
- Offer apprenticeship programs.
- Hire more qualified workers by improving your recruiting process.
- Make your company an attractive place to work.
Increase Workforce Efficiency with Technology
Another viable solution is to invest in asset management software, such as Wynne’s software, RentalMan, which is specifically built for your heavy-equipment rental business. This specialized software integrates with operating systems such as your current Oracle and SAP, providing you with a centralized platform and the critical asset data to help manage the entire lifecycle of your heavy equipment and its functions. It helps you be more effective with equipment use, resulting in a major boost to your ROI and profits.
New software and technology can also make your workers more efficient by streamlining the workflow in your organization. You can avoid such disasters as delivering equipment that is not needed yet, or too early or too late pick-ups of equipment. With your workflow more streamlined, you can eliminate the need for additional workers, save money, and have much happier customers.
New software and technology can also make your workers more efficient by streamlining the workflow in your organization. You can avoid such disasters as delivering equipment that is not needed yet, or too early or too late pick-ups of equipment.
Solutions You Can Do Today to Increase Profitability in Your Heavy-Equipment Rental Business
So, we’ve talked about some long-term goals. Now, let’s talk about some ways you can shake things up today to increase the profitability of your heavy-equipment rental business.
For a company to be profitable, it needs to have the right amount of revenue coming in. But before you can do that, you need to make sure the company is doing everything it needs to do for customers to rent from them.
Some ways a company can improve its chances of being profitable:
- Offer more payment methods than just cash. This flexibility will allow you to get more customers, which will help increase their revenue.
- Keep equipment properly maintained. Downed equipment is revenue sacrificed by poor planning.
- Give top-notch customer service. Customer service is all about keeping your promises. Mistakes, delays, and unavailable equipment are the primary reasons customers turn to someone else.
- Double bookings and misplaced equipment. An inability to manage equipment usage and schedules will cause scheduling issues, double-bookings, and unhappy customers. It will automatically reduce your revenue because of lost time.
- Lack of centralized systemic data. What equipment are you making the most money on? What equipment is bleeding you dry? With access to individualized equipment data and centralized systemic data, your business can make smarter decisions on the profitability of any asset, branch of asset groups, or an eagle-eye view of your entire organization.
- Outdated or ineffective software. Outdated software is dangerous. Hackers look for vulnerabilities that your internet service provider will miss and hold an organization’s data hostage by using ransomware. Also, outdated software cannot keep up with the needs of today’s businesses by providing AI analytics and data reporting that help you make more intelligent decisions about your company’s assets.
How to Prepare Your Company by Anticipating the Future Needs of Your Customers
If you want to be successful in the heavy-equipment rental business, you must understand what your customer’s needs are.
- Look for opportunities to solve a problem, not sell a product. Your customers will love you if you’re actively looking to help solve their problems.
- Gain background information on your customer. This will help you provide them with equipment that is ideal for their particular needs.
- Mine your current customers for future needs. It’s great to want to add a new piece of equipment or service geared towards bringing in new business. But don’t alienate your old customers to bring in new ones. Talk with those customers that are sticking by you and find out what equipment or services they will look for in future projects. It’s easier to keep an old customer happy than to gain new ones.
- Give customers the opportunity to “try” before they buy. This is an especially cool thing to do when they are testing out “new-to-them” equipment. Take them out to the yard to get a feel for the equipment — or you could let them try out the newest line of deck ridging crimpers right there in the office!
In conclusion, the heavy-duty equipment rental industry faces many challenges, with labor shortages being one of the biggest obstacles. However, they can beat the odds by streamlining their business and focusing on what they do best – renting out equipment. The competition for workers is fierce, so the equipment rental industry must take steps to take full advantage of its market opportunities and provide quality customer service.
Streamlining your business is so important that there is no time to waste maximizing your heavy-equipment rental business’s potential. Let Wynne Systems show you how they can help you increase your ROI and profitability with their Rentalman solution for heavy-equipment rental companies.