Home Depot is aggressively seeking your rental dollars. The home improvement giant opened its 900th tool rental center last month and is on track to expand that number to 1,000 by late fall. While the total number of Home Depots is a moving target – the chain estimates it opens a new store every 48 hours – tool rental centers will open in all new stores, says Joe Dixon, vice president, The Home Depot equipment rental. “We’re also adding them to existing stores.”
Although hand and walk-behind tools make up the majority of Home Depot’s inventory, in select markets the company is now branching out into skid steers, compact excavators, air compressors, trenchers and aerial lifts.
Lifts catch notice
The last item has caught the eye of Wayne Huizenga, president, Luzer Electric, Miami. “Aerial lifts were the one major item we rent they didn’t have in our area,” Huizenga says. That is all set to change in south Florida, where Home Depot took its first delivery last month of a fleet of JLG lifts. “I’m looking forward to them because they are offering direct electric drive motors instead of hydraulic motors, so we won’t have any problems with dripping on our client’s floors.”
That Huizenga should be interested in Home Depot’s rental offerings is understandable – his company has done the electrical work on several Home Depot stores in eight Southeast states. Still, he pays the same rental rates as other walk-in renters. “I don’t need a discount because their rates are competitive,” he says. The store offers half-day (four hours), daily, weekly and monthly rental rates. Most rentals are less than three days, however.
For Bob Knight, owner of Knights Landscaping, Medway, Massachusetts, one of the primary reasons he uses Home Depot is the condition of the equipment. “It’s very well maintained, either new or in good condition.” Huizenga agrees. “We’ve gotten some tools where we were the first customer to use it.”
This is just the reaction Dixon wants Home Depot customers to have. “We have the youngest fleet in the industry,” he says, “and the average age of our inventory – including our utility equipment – is 19 months.” Dixon also emphasizes convenience, both with several hundred locations and with “the longest hours in the business:” 6 a.m. to 10 p.m., seven days a week.
Home Depot concentrates on small-to-medium contractors and trades people “because they are in our stores every day buying building materials,” Dixon says. “With rental, we can give them an additional service. We can sell them the entire project.”
This makes sense to Knight, who says he’s always in the store buying everything from lumber and shrubs to glue and tape. “It’s convenient, and we rent everything and anything, including chippers, stump grinders and Bobcat excavators.”
While its previous agreement with Hertz Equipment Rental has ended, Home Depot still refers customers who need equipment they don’t presently carry to Hertz.
In select markets, Home Depot is now branching into skid steers, compact excavators, air compressors, trenchers and aerial lifts.
Delivering the goods
One sticking point for both Knight and Huizenga is Home Depots’ lack of a delivery and pickup service. “When we start renting aerial lifts, it just won’t be possible for us to send a truck big enough to pick it up like we can with the rest of the items we rent,” Huizenga says. “I’m not sure how they’ll handle that yet.”
“We are developing delivery solutions and piloting a program in a few different markets across the country,” Dixon says. “We want to make sure we have the correct process in place before we roll it out to all the stores.”
And what happens when a rental item goes down? If it’s a tool, Dixon says you can bring it in to exchange for a working tool. On its larger equipment, Home Depot has contracted with third-party vendors, including construction equipment dealers, to field service the equipment.
Rental purchase options will also be available in the future for most of the company’s rental equipment, Dixon says. “Our main goal is to provide pro customers with the service and convenience they need to make them profitable and successful.”
There are now 99 NationsRent rental centers operating adjacent to Lowe’s stores, the result of an exclusive, multi-year agreement the two companies signed in October 2000.
“Our NationsRent at Lowe’s stores are designed to offer one-stop shopping with convenient access to building supplies, name brand tools, retail merchandise and equipment for rent and sale all under one roof,” says Jeff Putman, NationsRent chief executive officer.
Both parties benefit, he says. For Lowe’s, having NationsRent stores in its locations provides increased revenue from new and existing customers. In turn, NationsRent enjoys access to a large homeowner base that typically doesn’t shop at a traditional stand-alone rental store.
Each NationsRent at Lowe’s location occupies about 1,350 square feet of retail space at the front of the Lowe’s store adjacent to its commercial entrance. Outside equipment storage takes up an additional 2,500 square feet.
“We offer the full line of rental equipment, sales and service our customers have at any of our stand-alone locations,” says Putman. These stores stock higher-volume items, while local stand-alone NationsRent stores provide the Lowe’s-based stores with larger items and service.
The stores operate 7 a.m. to 7 p.m., Monday through Saturday and 8 a.m. to 6 p.m. on Sunday.
Both the Lowe’s-affiliated stores and the stand-alone stores offer the same services, including delivery services, web-based used equipment buying and finance and equipment purchase options.
Rates include half-day, daily, weekly and monthly rental terms. Each Lowe’s-based store shares the outside sales team and service technicians with the NationsRent stand-alone stores in their area. “Customers may also receive after-hours assistance with their service needs by dialing our 1-800-No Sweat line,” Putman comments.
NationsRent at Lowe’s stores draw in new customers with event marketing, including contractor appreciation luncheons and equipment expositions. They also market through direct mail and telemarketing.
Putman sees the association with Lowe’s offering new options to Lowe’s customers. “Our diversification beyond rentals into sales and service is paying big dividends to these customers in terms of the convenience of a one-stop shopping experience,” he says.