Often it takes a major event or change to force radical change. In just a couple of months, we can clearly see how the impact of COVID is transforming many industries around the world including construction equipment rental companies.
If we look back to previous recessions, most construction contractors turned from owning to renting construction equipment to lower their risks and save money. In response, OEM manufacturers started designing their equipment with fewer options and focused more on durability and simplicity to help increase ROI for equipment rental businesses.
This time around, OEMs and construction rental companies are shifting their investments into technology-powered solutions because the positive ROI impact can be more easily realized now that a digital transformation has been thrust upon us like the need for contactless rentals.
Articles like the CONEXPO-CON/AGG 365’s on: “How Tech is Changing the Equipment Rental Market”, highlights the benefits of technological advancements in equipment and tools. Most businesses continue to rent instead of pay a substantial amount upfront to own, thus gaining access to the latest technological advancements and the ability to acquire more specialized equipment in one’s fleet.
Yet, that won’t be the most significant change to the industry. We predict that the evolution of software in construction will be the next big wave over the next five years. Although most companies already have a software, its been primarily focused on operating their business and NOT serving their customers. (See further below.)
Construction equipment rental software stack
Today’s modern contractor has three core technologies they rely upon to run their business:
1) Fleet Management Software, 2) Telematics and 3) Rental ERP Software.
- Fleet Management Software (FMS) enables the management of specific tasks relating to a fleet of vehicles such as managing the maintenance history, vehicle disposal, insurance, government regulation, driver license management and dispatch & scheduling.
- Telematics primarily uses GPS + CAN data to receive information that helps capture vehicle information like runtime, fuel levels, vehicle location and more.
- Rental ERP management software usually covers all aspects of a rental business in a systematic way, including financials, customer relationship management, inventory management and reporting, especially around utilization rates.
Something interesting that all these three software solutions have in common…
They all primarily focused on the company’s point of view – not the customer. This software was designed to make operations and back-end processes easier but not the lives of the customer more comfortable. This is strange because construction rental companies pride themselves on the long-term (sometimes generational) relationships they have built with their customers.
A Customer-First Approach
For construction and material handling equipment rentals, the tipping point and need to adopt new technologies was very sudden. Many companies have built their success on long-lasting, personal relationships forged over years and even decades. Picking up the phone or going down to the lot to grab a piece of equipment is more than a business transaction but rather a check-in with your friends to catch up and talk about the latest news.
However, with digital marketplaces starting to appear and the push from COVID to enter an era of contactless rentals have created the perfect storm. Now it’s time to review all your processes from the customer experience point of view.
You’ll need software that makes it easy for customers to see what you have available and allows customers to reserve the equipment they need online. Sure, you have online booking today, but how can you become even more flexible with rentals by the hour, rental equipment sharing, rental pools, rent by the functionality, overnight equipment deliveries and so much more.
A New Contactless Rental App Approach
Look > Book > Unlock > Operate > Return
The customer should be able to schedule a date to pick up the rental or schedule a time for you to drop the equipment off to them. When the customer is done, they should be able to either drop the equipment off or schedule a time for you to pick it back up.
All of this can now easily be managed via a smartphone. By pairing a mobile app with a digital key solution to the vehicle and the order, construction rental companies will be able to significantly reduce the labour and inefficient steps for their customers to grab and use the machines they need, when and how they want them.
By adding equipment access and digital key management to your contactless mobile construction rental app, the possibilities to set different policies, connecting man & machine usage, and unlocking new revenue streams is now possible.
Thought Leadership Series
We hope you enjoy our thought leadership series, where we discuss how each key component of the construction rental software stack needs to be re-invented from the customer point of view.
Next in this series: Extending telematics into your equipment rental customer journey!
If you have any comments, suggestions or questions, please feel free to reach out.
Happy reading.