FROM 1982 to 1997, Daniel Kaplan served as president of Hertz Equipment Rental Corp., the largest industrial and construction-equipment rental company in the world, and helped the company grow from $58 million in sales to more than $500 million. Now he shares his knowledge of the rental industry through his consulting firm, Morristown, N.J.-based Daniel Kaplan Associates, which advises corporations on how to enter the equipment rental industry and assists those already in the business improve their operations. A rental expert, Kaplan also gives talks on the rental industry that cover both equipment rental as well as the party and event rental scene.
SPECIAL EVENTS MAGAZINE: How has the rental business changed since you started in it?
DANIEL KAPLAN: I deal with companies around the world who want to get into equipment rental. That gets into fleet mix, staffing, operating statements, facility layout, sales and marketing plans — a whole A to Z effort.
I do a lot of speeches on rental, and I have a whole section of my presentation on special events. I talk about the emergence of the industry, and I get the information from your magazine. I talk about the size of the industry, the stratification of the industry, what typical inventory is, where does the special event revenue come from and the corporate-event market. I give them a preview of party and event rentals.
Q: What are some of the common mistakes you see in the party rental business?
A: I would say not working hard enough on image. A lot of party rentals are contaminating the operation with tool. They're not adequately segregating the party from tool. I would really like to see a separate party rental building — a whole segregated building.
Q: Do you see the party rental consolidation trend — for example, Classic Party Rentals, Select Event Rentals — continuing?
A: Absolutely. In a way, Classic is a sleeping giant. I consulted with them in the very beginning. I think you're going to see this company growing, doing more acquisitions and more cold starts, and putting more equipment in there and becoming an even bigger player. I certainly believe that others will follow.
Q: How has the rental business changed since you started in it?
A: You certainly have to pay significant attention to what's happening with Classic Party Rentals. Classic is the future of the major-league party business. When people read your magazine about Classic Party Rentals, they think Classic is driving it — it's really private equity that came in there. A very intelligent person working for {Greenwich, Conn.-based private equity investment firm} Dubin Clark {& Co.} saw the opportunity and had a vision of what this industry could yield. This individual highlighted Classic, and they acquired them, and they've given up the capital to grow the business. For the most part, thus far, they haven't been challenged. There's nobody moving on the scale of Classic Party Rentals. But the point I want to make is: It's not a party rental company or a special event company doing it — it's private equity who has the money to invest in it and drive it and seize the opportunity. I think you'll see more of that in the future. You can transfer inventory between stores. You can afford to buy more specialized equipment. You can have enough inventory, if you're large enough, to handle any size event.
Q: What do you foresee for the future of party rental?
A: There's a bright future in party rentals as the industry continues to grow. I would think that it's larger than the $1.9 billion estimated. I would think it's at least $3 billion as the economy improves and people are earning more money. The American Rental Association — they've got it at $1.9 billion. And your magazine, you've got Classic Party Rentals at $185 million as of your October issue. And there are a lot of big companies. If 10 companies have a share of 21.8 percent, it just seems to me that it's larger, and I have a pretty good feel. I'm traveling around rental every day of my life. It just seems to me 1,856 stores are doing more than that number.
Daniel Kaplan can be reached at 973/285-3199 or [email protected].
