10 golden sentences for the high-altitude equipment leasing industry in 2024 that are "worth thinking about"

As we move into the second half of 2024, a review of what the leaders of the equipment leasing industry in Europe and the United States have said since the beginning of the year reveals that these views, while not exhaustive, provide valuable wisdom and reflection on the future direction of the industry. (Reporting by InternationalRentalNews)

No.1 "There's a lot of room for growth in the professional rental industry" - Kyle Horgan, Sunbelt Rentals Growth in the professional rental business is one of the core objectives of the Sunbelt 4.0 program. The program covers 12 different business lines, starting with power and heating, ventilation and Air conditioning (HVAC), and is planned to reach a size of $1.9 billion by the end of 4.0; The newest business line, temporary walls, is expected to reach about $50 million over the same period. "If you add all of these lines of business together, our plan is to add $2 billion over 4.0 and eventually get to $5 billion in professional leasing," said Kyle Horgan, senior vice president of business development for Sunbelt Rentals. Ashtead's specialty leasing business, which includes power and HVAC as well as flooring solutions, grew 14 percent in fiscal 2024. "We know that the penetration rate of professional leasing in this segment is still low compared to the general tool and equipment leasing market, and the room for future growth is very large." 'he said. "We added three brand new product lines during 3.0: Temporary buildings, temporary fences and temporary walls. All of these product lines are in their infancy and have a lot of room to grow in the future. We know there are more opportunities.

No.2 "Inflation is the biggest concern" - Mike Disser, RMC Consults While the market was expecting growth in the U.S. rental market in 2024 and the actual results exceeded expectations, that doesn't mean there aren't challenges. "One of the biggest hurdles facing leasing companies is getting an acceptable return on rapidly rising equipment, operating and staff costs," Disser said. He believes that leasing companies will have to raise rental prices and will need to be able to explain it in a way that is acceptable to customers without losing customers. He added: "Inflation is the biggest problem. Costs are rising at an unprecedented rate and are difficult to absorb or pass on to customers.

" No.3Andy Wright, Vital Power Andy Wright quotes Peter Drucker's famous saying that "culture is more important than strategy" and explores the meaning behind it. "I don't think he's saying that strategy isn't important, but that a strong and positive culture is the best way to ensure the long-term success of the business," he notes. He emphasized that only those teams that fully identify with the company's goals and mission can overcome all challenges. Wright also pointed out that hiring should not be taken at face value, but should ensure cultural fit by deeply understanding the candidate's background.

No.4 "Looking for a purpose rather than a job" - Thibault Itzel, Genie - With the impact of social media, the pandemic and big technology, Gen Z is entering the job market. But what are their job requirements? How are these demands affecting the construction and leasing industry?

Perhaps, in addition to providing good pay and conditions, what Gen Z wants most from their work is a sense of purpose that goes beyond just making money. "The new generation is more about goals than jobs," says Thibault Itzel, a salesman at Genie. "They look at the values of the company and want them to match their personal values. Of course, they also check the company's website and social media posts. They also ask these questions during the interview. What social projects are you working on as a company? Are you volunteering somewhere? Do you have a sustainability initiative? This is definitely new.

No.5 "Even with AI, leasing is still labor-intensive" - Joel Sarkka, Renta AI and machine learning can improve business productivity, but Joel Sarkka believes that the leasing industry still requires a lot of manual operations. "Even if machine learning can tell us when maintenance is needed, we still need to do the actual maintenance, install telematics units, set up scaffolding or move site facilities," he says. Whatever the impact of AI, it's a very labor-intensive industry and it's a very labor-intensive job." And the problem is likely to get worse; "Our aging pyramids don't look like pyramids anymore. We can expect that the labor shortage will not ease soon. We have more and more experienced employees, and obviously they are retiring. So we have to attract more employees from a broader talent pool." Mr Sarkka argues that rental firms must attract talent from a wider pool; "We have to make the workplace more attractive, whatever activities we need to carry out to show that we are an attractive employer and then communicate the highlights of our industry."

As for the future of the rental industry, REIC Executive Chairman Kevin Fitzgerald said he sees continued consolidation among the top five to 10 players.

No.6"Big companies are going to get bigger and bigger, and then there will be companies like us, and we're going to get bigger and bigger," he said. "Capital is the key driver of growth today. Big companies have capital, but a lot of small companies don't." "In the next five years, the deal value of the industry will continue to rise, the big companies will grow further, and the small companies will continue to emerge." It's all because the demand is there, and we're still only around 55 percent lease penetration in the U.S."

No.7 "More than half of all equipment in the United States is leased" - John McClelland, American Leasing Association (ARA) At the ARA show in February 2024, the ARA reported that rental penetration in the United States has reached 56.4 percent, near its pre-pandemic peak. "More than half of the equipment in the U.S. market is leased equipment," said Dr. John McClelland, vice president of government affairs and chief economist at the American Leasing Association. He noted that the American Leasing Association's lease Penetration Index reached an all-time high of 56.7 percent in 2019, but fell to 51.5 percent the following year due to epidemia-related challenges. Josh Nickell, vice president of equipment leasing at ARA, said the relationship between uncertainty and lease penetration has never been a straight line. "Whenever there is a shock to the system, such as in 2008 or during the COVID-19 pandemic, we usually see an initial big drop in lease penetration," he explained. "Let's say you're a construction company with a mixed fleet of owned and leased equipment, and all of a sudden, things slow down. Which team will disappear first? "Contractors don't immediately sell the equipment they own, they stop leasing. But the next time they need equipment, they tend to rent it rather than buy it. Rental penetration subsequently recovers and usually exceeds the previous decline.

No.8"We're offering a complete suite of site services" - Scott Cannon, BigRentz CEO Scott Cannon says the rental industry is in relatively good shape. "The supply of equipment has been a problem for the last few years because the pandemic has really hit the supply chain hard," he said. "But the growth over the last few years has been pretty good. In the coming years, the government will invest a lot of money and launch a large number of infrastructure projects, so rental penetration will continue to grow. In this day and age, not owning a device is a smart move. "But there are broader issues in terms of staffing and having the right craftsmen. There are going to be a lot of retirements in the next 15 years and there is a gap where everyone is being told to go to college without learning how to be a craftsman. It's really going to put pressure on our industry. The cost of materials has been a very big variable over the last few years." "We're trying to provide a solution for the company," Cannon continued. They need access to materials, equipment, and craftsmen. If you put it all together, I think we are looking to provide a package of site services. This is where the company is going in the long term."

No.9 "Finding professional Help is out of the question"

Dave Dworschak, owner and president of Don's Rental in St. Helens, Oregon, USA, says the success corporate Rental chains have had this year is not necessarily representative of what smaller companies have experienced. "If you read the quarterly reports from corporate leasing chains like United Rentals, or the regular industry forecasts from the American Leasing Association, you might think that the rental industry in the United States is poised for another year of growth, with a few more to follow. While that's good news for anyone with an interest in the industry, it's not a consistent description. In fact, things can be very tough for small independent companies in markets outside of developing cities, "he said. One challenge is staffing. "In the rental industry, it is impossible to find trained help," he says. "You have to train everyone and that takes time and investment. Excellence and efficiency are commonplace topics.

No.10 "The rental sector itself is sustainable" - Amelia Woodley, Director of Speedy Hire, says the construction sector accounts for nearly 40% of global emissions (UNEP, 2023), And the leasing sector has an important role to play in helping to decarbonize the industry, because in the big picture, it plays a key role. "Previously, the industry focused on decarbonizing large elements like steel and concrete, whereas now the industry is looking at plants and equipment and how to make them more sustainable," she said. "Here, the leasing industry has an opportunity to leverage its strong credentials in sustainability and demonstrate leadership." "It is important to emphasize that the rental industry itself is sustainable. Circularity is at the heart of the industry, with both individuals and businesses renting items and returning them rather than buying them all at once, which embodies the core practice of leasing." She concluded: "The design of this model itself promotes sustainability and a circular economy, which is also recognized by the investor market as a key principle for achieving net zero emissions. Without a circular economy, there is no road. So the leasing sector has a huge role to play."