6 Ways Equipment Rental Software Prevents Revenue Loss

What is the one concern that haunts every business? Improving the bottom line.

The equipment rental business is no different. Increased revenue is the focus of the rental business too.
As we all know, with the increase in infrastructure projects and increased competition, more businesses are opting to rent rather than invest in the equipment they require. Renting equipment instead of outright purchase provides companies the option of saving on capital investment and improved access to the latest technology.

While this trend is encouraging for the equipment rental companies, it also means an increase in the competition. Equipment rental customers often reach out to our rental ERP experts at To-Increase, seeking advice on how they can grow their revenue.

Over the years, we have been guiding our customers on what steps they can take, and how they can leverage DynaRent, our complete equipment rental ERP software solution to improve revenues.

In this blog, we will take a look at how an equipment rental ERP can help you address some of the common problems that rental companies face. From equipment lifecycle management to billing correctly and on-time, an excellent rental ERP solution will get you back on track.

Here’s how equipment rental ERP can help improve rental revenue

Let’s start this exercise with a complete overview of the common problem areas that the equipment rental business faces.

1. Equipment Non-Availability
One of the factors that can affect the flow of revenue in the equipment rental business is that the asset is not available for rent because it is being repaired or undergoing maintenance.

Companies often find that they get complaints from customers about the equipment they have rented. This, in turn, means that the machine has to be serviced or repaired, which delays delivery to the next customer, affecting the revenue they have projected.

How Equipment Rental Software Helps

Equipment rental ERP allows you to manage the lifecycle of an asset right from the purchase to the stage where it is disposed of as scrap. Using this feature, you can maximize the equipment’s availability.

For instance, you can schedule the repairs and maintenance during slack periods. Alternatively, you can look at the machine’s performance over time to schedule preventive maintenance. Taking these steps will ensure that equipment availability increases and thereby generates more revenue.

Image 1: Equipment Lifecycle Overview

2. Scheduling and Transportation
Another major roadblock to improving the revenue of rental equipment is the time that it takes to pick up the asset from one customer and to deliver it on time to the next. It is imperative to schedule the rent of an asset without overlap or too much downtime.

Late pickups can lead to delayed deliveries, which will cause you to miss out on revenue. Transport of equipment is another cost factor that you need to plan well so that the rental asset is profitable.

How Equipment Rental Software Helps

Many equipment rental ERP solutions offer you a graphical planboard. A planboard will show you the exact location and usage of each asset. You can use this to streamline the movement of each asset.

With a complete overview of the operators, the asset location, and even the movement schedule, you can ensure that you are not overscheduling, missing out on maintenance and that the asset is not lying idle. Proper transport planning also helps you control the cost of transportation.

Image 2: Transport plan board in DynaRent for Microsoft Dynamics 365

3. Capitalizing on Packages
In many rental scenarios, the way to generate revenue is by upselling or cross-selling of assets. For instance, you can offer a tipper to a customer who is renting an excavator as both pieces of equipment often need to be used in tandem.

Another example is offering a customer renting scaffolding some harnesses for safety purposes. There are many such opportunities where you can generate more revenue but do not because you do not have the information on hand.

How Equipment Rental Software Helps

Equipment rental ERP provides you with the option to build up rental kits. These are mostly kits of equipment that could work with each other. For instance, you can rent cleaning equipment along with drills as a package.

What is more, often, customers may seek bulk rentals (serialized and non-serialized equipment) as a package for their project. Being ready to deal with such scenarios by structuring and monitoring your bulk equipment can help you increase revenue.

It is easier for the customer to rent out all the equipment they need from one place, and such deals also offer you the chance to build up your revenue and control transportation and other related costs.

Image 3: Business Object Availability in DynaRent for Microsoft Dynamics 365

4. Missed Revenue
When you rent out equipment to customers, it is with explicit understanding and acceptance of specific rental and usage terms. For instance, some sensitive material cannot be used continuously due to heating or other damage, which means limiting the use to a specific number of hours.

However, you have no means of tracking the usage, as in most cases, the customer’s site would be remotely located. Overuse of your equipment (as opposed to the agreed terms) not only represents missed revenue but also an additional strain on the machine.

How Equipment Rental Software Helps

With technology like the internet of things (IoT), equipment rental software can help you keep track of the movement of your asset from one site to another. Tracking the movement and usage of the assets can help you ascertain if the customer is using the asset as per agreement.

In the case of overuse, you can bill the customer for the extra amount. Having the ability to track equipment usage with IoT also helps you ensure that the equipment is kept in reasonable condition by planning the required service and maintenance.

5. Lack of insights
In the rental industry, the equipment that is in demand keeps changing due to many macro factors. For instance, the increase in infrastructure projects can create a higher demand for certain equipment.

Changes in technology is another factor that has an impact on the demands for specific equipment. There could also be other factors, including the latest trends, quality restrictions, safety measures, and more.

What you need ideally is to have an overview of the assets that are high in demand and with the highest rates. Having this information will help you plan better and make informed investment decisions.

How Equipment Rental Software Helps

Today, data has become the currency for decision making, and having business intelligence both from within and at the industry-level can be vital to your business.

Your equipment rental ERP software can help you with this aspect by providing business intelligence. With this intelligence, you can draw insights on the assets that are higher in demand and rates to maximize your revenue.

Insights into what the market is like, along with key performance indicators that you should measure, is another way in which data can help you to maximize revenue. Business intelligence in the rental sector draws from both internal and external sources.

Image 4: Daily Rental Analysis Overview in DynaRent BI

6. Missed or Delayed Updates
The rental operation has many touch points from your back office to your storage areas, your field team, your operations team, and other teams.

Often teams that are out in the field, either delivering the asset or picking it up, are the ones that get a lot of data and updates from the customer.

However, often these updates and changes may not reach the back office for action to be taken because the field team may find it tough to come back and complete the paperwork.

In some cases, there could be changes in the rental agreement, which needs to be updated (like the extension of the rental period) so that the customer can be billed for it without delay. All these are missed revenue opportunities.

How Equipment Rental Software Helps

Today, equipment rental software allows the various teams involved in the rental operation to access the solution on mobile devices of their choice.

What this means, is that instead of relying on their memories or scribbled notes, field teams have the option to update changes using their mobile device in real-time.

Billing for extra usage, service requests, asset movement updates, or any other changes that the customer wants or has made can be updated at once to the back office so that they can take immediate action.

You need to check if the equipment rental software allows you to use mobile devices of your choice and lets you configure access as per user so that you get the best results.

The way forward:

Today, technology has had a significant impact on the way the equipment rental sector works. Many of these changes can be harnessed to help increase revenue and minimize expenses.

Here are some steps that you can take to select and implement the right equipment rental software:

• Evaluate the problem areas in your business that affect revenue generation
• Discuss the possible solutions to resolve these issues with different teams
• Calculate the costs (actual and opportunity) of equipment rental ERP software
• Pitch the business case to your top management with the ROI and the impact it can have on various stakeholders

Would you like to learn more about how equipment rental software can help you? Download the buyer's guide below.