Be Careful of Straying from What You Do Best
We at Rentals Acquisitions LLC are all for sales items that are complementary to rental. Some of the ones we’ve seen that are most successful include small batch concrete, concrete supplies and related tools, propane sales and general type contractor supplies such as safety equipment, blades, abrasives, marking paint, Gatorade, water coolers and small hand tools. A larger offering than this rarely works unless you are Home Depot. Too often we see a rental store whose gross margins on sales are more than wiped out by investment in obsolete or slow moving inventory. Remember another one of our mantras: DON’T BUY ANYTHING THAT WON’T SELL IN THE NEXT 90 DAYS.
Other sales and non-rental offerings offerings that we generally don’t “pencil out” in rental stores are new equipment/dealership type sales, parts sales, non-owned national rental trucks, lawn and garden equipment sales or any type of specialty equipment that has to be pioneered in the marketplace.
Time spent focusing on rentals—working with your salesmen, comparing your rental rates with that of your competition, identifying chronic maintenance equipment, rebalancing/reallocating your rental fleet, talking with your rental customers—all will pay much higher dividends in the long run than time and investment in sales items.