Download - Rental As A Federal Acquisition Alternative

Federal Acquisition Service

U.S. General Services Administration

Rental As A Federal Acquisition Alternative

Dana FairleyBusiness Development Specialist, GSA John

McClellandVice President, Government AffairsAmerican Rental Association (ARA)

2


Today's Goals

Inform Customers about Schedule 51 V, Offerings Explain the Partnership between General services

Administration (GSA) and The American Rental Association (ARA)

Introduce ARA Explain the Benefits of Rental Illustrate Rental Offerings under the GSA Schedule

51V

3


The GSA Center for Facilities Maintenance and Hardware (CFMH) is one of seven GSA Acquisition Centers. The “Centers” award and administer the Multiple Award Schedules Program.

4


The Center for Facilities Maintenance and Hardware Manages Two Schedules:

Schedule 03FAC Facilities Maintenance and Management Services such as:

Complete Facilities Maintenance HVAC Plumbing Electrical Energy Solutions Elevator Inspection and Preventative Maintenance

5


The Center for Facilities Maintenance and Hardware Manages Two Schedules:

Schedule 51 V Hardware SuperStore Products typically found in a Hardware Store, such as:

Tools and Tool Kits Lawn and Garden Equipment Woodworking and Metalworking Equipment and

Machinery Coatings, Adhesives and Sealants Rental and Leasing of products

6


GSA’s Partnership with American Rental Association (ARA)

Established in the Fall 2008 to increase awareness of rental as a viable acquisition alternative

ARA, CFMH and Rental Schedule Holders MarkeTips Promotion, Slip Sheet Development,

Conferences, Newsletter, EXPO Class, etc.

7


About ARA

Membership trade association founded in 1955

Source for research, information, government affairs, business development tools, education and training, insurance and marketplace opportunities

Construction/industrial, general tool and event equipment rental

8


ARA’s Role in the Industry

Promote the success of our members and advance the growth of the equipment rental industry

Information source and resource Advocate for industry growth and success Industry image Resources contributing to business success Buyer-seller connection

9


ARA Membership General Member:

A business engaged in renting tangible personal property to the general public (“Rental Business”)

Associate Member: A business engaged in furnishing or providing

equipment, merchandise or services related to the Rental Business, but not otherwise qualified to be a General Member

10


Market Segments Defined Construction/Industrial Equipment:

Almost exclusively rented by construction companies or contractors

• Earthmoving equipment • Access equipment• Pumps & generators

11


Market Segments Defined Construction/Industrial Equipment:

Industrial equipment comprises a broad range of equipment used in the production or movement of other goods

manufacturing machinery transportation equipment medical equipment

12


Top Construction Rental Equipment1. Skid-steers2. Mini-excavators3. Excavators – full size4. Telehandlers5. Aerial work platforms6. Backhoes7. Forklifts8. Mini/midi wheel loaders9. Compressors – trailer

mounted10.Attachments

According to the 2008 ARA/IHS Global Insight survey

13


Market Segments Defined General Tool Equipment:

Equipment usually rented by professional contractor and do-it-yourself (DIY) homeowners for light construction, including building renovations, additions, concrete work and landscaping.

small hand-held tools yard-care equipment jackhammers pressure washers small skid steers

14


Top General Tool RentalEquipment

1. Jackhammers2. Concrete-cutting saws3. Walk-behind trenchers4. Yard-care equipment5. Pressure washers6. Compactors7. Scaffolding8. Manlifts9. Pumps10.Floor- and carpet-care equipment

According to the 2008 ARA/IHS Global Insight survey

15


Market Segments Defined Event Equipment : Items rented to homeowners, consumers and

corporations for celebrations, promotions, recreational and special events.

Items in this segment could also be rented by groups like FEMA, Red Cross and other emergency assistance organizations

• Tents• Tables and chairs• Linens and tableware

16


Equipment Rental Industry Size The 2008 United States equipment rental revenue

was estimated to be $35.3 billion

• Construction/Industrial equipment = $24.5 billion

• General tool equipment = $8.4 billion

• Party and event equipment = $2.4 billion

17


2008 United States Economic Impact of the Rental Industry Employment: 613,348

Industry output (Million US$): $96,847

Value Added (Million US$): $52,119

• Labor income: $30,266 million • Indirect business taxes: $4,831 million • Business income: $17,021 million

18


Why would GSA customers want to rent equipment?

Transfer burden and costs of ownership

Provides the right equipment for the right job

Advice and assistance from professional staff

Flexibility and availability of equipment

Professional grade, heavy-duty equipment

Environmentally friendly and recently manufactured

19


Benefits of Renting versus Lease/Purchase

Transfer burden & costs of ownership

Ownership requires a capital investment to cover the direct costs of equipment

. . . BUTRenting keeps the burden of buying, maintaining, and

Selling the equipment on the rental business, not on the customer

20



Transfer burden & costs of ownership

Renting offers the widest variety of equipment for added job versatility without the added hassles associated with ownership, including the costs of:

Warranties Insurance Regular maintenance and repairs Storage Transportation

21



Assistance from Experienced & Professional Staff

Renting not only helps reduce costs, it also provides access to expert knowledge and training. It allows customers to take advantage of staff professionals who will:

- Assess and secure the right equipment for the job

- Offer a wide variety of specialized and modern equipment

… Some rental businesses offer specialized equipment applications, such as scaffolding services, aerial specialists, pump & power, and more.

22



Flexibility & Availability of Equipment

Renting allows the customer to take on a wide variety of jobs and projects that may require equipment that they don’t have the capital to purchase

Seasonal and large jobs require specialized equipment that can be obtained by renting.

Renting allows for equipment to be available when

and where needed.

23



New EquipmentNew Equipment Rental companies make significant annual

investments in the newest, most advanced equipment on the market:

Franks Supply Company, Inc.Hertz Equipment Rental, Inc.Neff Rental, Inc.RSC Equipment Rental, Inc.Sunbelt Rentals, Inc.United Rentals, Inc.

24


Benefits of Renting versus Lease/Purchase Environmentally Friendly – “Clean & Green”

Because rental equipment is newer, renting instead of buying insures that customers have access to the most fuel-efficient and emission controlled equipment on the market

All rental stores in California with certain types of equipment are required to be in compliance with CARB regulations

• These regulations can be implemented in other parts of the U.S.

25


Evaluating the Rent vs. Buy/Lease Decision

26


Fleet Management Metrics Time Utilization: the percentage of time a piece of

equipment is rented or at a job site.

Dollar Utilization: the cost of a piece of equipment new divided by the revenue generated by that piece of equipment.

Average Fleet Age: the age in months of a piece of equipment.

27


Rental Fleet Averages

The average construction rental fleet has a time utilization of 55-65 percent.

The average dollar utilization of a rental fleet is about $0.45.

The average age of a construction rental fleet is just under 35 months.

28


Factors to Evaluate

Estimate the time utilization of the equipment you want to acquire.

Determine the rental rate (day, week, month) of the equipment based on how it is used.

Determine the total cost of acquiring the equipment through a purchase or lease.

29


Decision Rules If the annual cost of rental charges divided by

acquisition cost is less than $0.45, consider renting. If your estimated time utilization is less than 55

percent, consider renting If your jobs are varied and require special equipment,

consider renting. If your fleet’s diesel emissions are controlled by

regulation, consider renting.

30


Renting Equipment Through GSA

Schedule 51V Suppliers currently include: Frank’s Supply Company, Inc. Hertz Equipment Rental Corp. Neff Rental, Inc. RSC Equipment Rental, Inc. Sunbelt Rentals, Inc. United Rentals, Inc.

Contact your GSA contracting officer about modifying your contract to include rental today!

31


32


33


Summary of Rental Equipment rental is largely diversified Rental businesses are located everywhere you need

to do work and provide equipment for every type of job

Renting offers the newest equipment at the best possible price

It is an environmentally sound choice Rental professionals offer expert advice and maintain

the equipment

34


Rental under the GSA Schedule

Rental is a Viable Acquisition Alternative Rental Often Makes Good Economic Sense Schedule 51V Provides Excellent Selection of Rental

Companies Schedule 51V Rental Companies have a Vast Array of Products

to Fulfill Your Acquisition Requirements For Additional Information on Rental, Please Visit

‘http://www.gsaelibrary.gsa.gov/’ and Search Schedule 51V

35


36


37


Thank You!Dana Fairley

Business Development Specialist, GSA(816)823-4258

[email protected]

And

John McClellandVice President, Government Affairs

American Rental Association(202) 289-4460

[email protected]

Download - Rental As A Federal Acquisition Alternative

Top Related