Although no one is ready to celebrate yet, most event rental operators see a break in the business clouds in 2010
The annual Special Events event rental forecast for 2010 shows a brighter mood among operators, with fully 52 percent expecting to handle more events in the new year, up from only 37 percent in last year's survey. And for the business savvy behind the statistics, here are comments from some leaders listed in our “30 Top Event Rental Companies” feature:
WHAT WILL SMART RENTAL OPERATORS DO THIS YEAR TO STAY IN THE GAME?
“We will be working closely with our catering and planning clients in a partnership fashion to ensure that together, we maintain the level of service and commitment clients have come to expect, despite reduced budgets. In some cases this may mean delivering ‘upgraded products’ or partnering on deliveries with other suppliers on an event in order to keep costs low.”
GREG HALTON, president/CEO, Event Rental Group, Toronto
“The best strategy for survival is the old standby: service, service, service. We all provide the same basics. What will determine who will still be here next year is going to be the trust we provide to our customers.”
JIM “SMITTY” SMITH, general manager, Kirby Rentals, Orlando, Fla.
WHAT STEPS ARE YOU TAKING IN YOUR SPECIFIC MARKET TO ADAPT?
“We are researching other revenue streams that fit our scope of event production. We have also been travelling cross-country for events since Michigan's economy is so bad.”
LARRY GUITAR, president, Special Events Rental, Warren, Mich.
“We are looking for ways to give our clients a competitive edge. For instance, we have spent a great deal more time educating our catering clients on how to sell our product so they have an edge. When you understand what you are selling, you can do it with a much greater confidence, and the end client will surely see that in the presentation. We are in turn making the effort to diversify our offerings by partnering with vendors to sell more of their products.”
DAN NOLAN III, general manager/managing partner, Tents Unlimited, Marietta, Ga.
WHEN WILL ECONOMIC RECOVERY START?
“2010 is showing some signs of life; we see events for the early half of 2010 booking up.”
“I believe we will begin to see a sustained recovery in Q3 2010. I think it is at that point that the corporate event business will reemerge as a strong segment.”
“I don't see a big economic recovery in 2010, but I do see a slight recovery in rental rates. The pricing got really low during 2008 and 2009; we are now seeing our customers realize that there is value in paying a little more for the services we offer.”
CHET FORTNEY, president, A-1 Event & Party Rentals, Covina, Calif.
“I feel we will see a year-over-year growth this year. It may be small and we will certainly not get back to year-end 2007-2008 levels, but I believe we will see it happen this year. I do not hear the doom-and-gloom as much, and clients are beginning to spend money again. This will be tenuous at best for a time, and this will be tied to unemployment, the stock market and housing. If one of those begins to falter again, we could be in for more rough water.”
CAN THE RENTAL INDUSTRY TAKE CUES FROM struggles in OTHER INDUSTRIES?
“Absolutely: Watch your receivables like a hawk, and scrutinize every new client. Also, keep debt to a minimum. If you can't pay cash, don't buy.”
“We need to become better marketers of our offerings across the board. Most rental companies, save Classic, could do a much better job of marketing and brand awareness. We simply have not reached the maturity in our industry to build brand awareness. We have not yet given the public a solution they cannot live without.”
WHAT IS THE “NEW NORMAL”?
“Discounting and price sensitivity is still rampant out here in the trenches; however, we still have to charge enough to provide the service everyone still expects, and we must also pay for maintenance to keep our reputation intact after this depression is history. I'm a big believer in keeping quality and service up no matter what. I will discount to a point but eventually it will catch up to you and before you know it, you become a second-rate operation — something I never want to be. The heavier discounts my competition throws out tells me that price isn't the only thing that's going to be discounted; you're going to get shoddy equipment and marginal service, and when things get better you're going to be stuck with that reputation.
“Manufacturers want to move their inventories, so now is a great time to be buying. Real estate is another bargain; we have just purchased a 92,000-square-foot warehouse right across the street from our current location, and the great thing is our mortgage for the building is less than our current rent for a smaller building.”
RICHARD LoGUERCIO, president/owner, Town and Country Event Rentals, Van Nuys, Calif.