“He’s over-leveraged, too much debt, too much equipment, he’ll never be able to unload it at today’s recession prices,” they predicted, believing his creditors that owned much of his debt would take over the company.
Ahern then defied the generally accepted logic of the time. Instead of selling off his considerable excess fleet — much of which had been forced off-rent by the termination of big Las Vegas projects — he spread it out across the country, opening 35 branches, a massive and expensive logistical undertaking viewed by many as foolhardy. While he was looking to hire, other rental companies were retrenching, closing branches, laying off staff and selling under-utilized fleet.
Obviously Ahern Rentals’ competitors did not welcome this incursion into their territories, an understandable market reaction. Business was tough enough in a recession without a new major player coming into town and bringing more competition. Rental companies established in a market always complain when national chains move into their territories, and don’t like it either when smaller more local competitors flex their muscles and expand into areas where they enjoyed strong market share. It’s the nature of business and nobody wants more competition.
Ultimately Ahern’s strategy worked as far as saving his company as this month’s cover story explains, and many of you already know the story. The economy improved, Ahern Rentals’ EBITDA and revenues grew significantly and the company got the funding it needed to pay off its creditors in full.
Don Ahern showed us all what he’d certainly demonstrated in the past — whether you support or oppose him, he is a risk-taker. And now he has taken another one by acquiring the struggling but respected Snorkel product line, into which he, through Xtreme Forklifts, is putting significant investment. The synergies between Xtreme and Snorkel are obvious and if you need further explanation, again please check out the cover story.
Buying such a company and returning it to relevance is full of challenges and risk but nonetheless it is a solid brand that can add value to this industry. There are a lot of Snorkel machines in the marketplace and them being supported properly is beneficial to the industry, especially owners of Snorkel equipment that will see the rescue of the value of their machines.
Ahern has a good team of engineers and manufacturing people between Snorkel and Xtreme. With the continuing growth around the world of the aerial industry, there is plenty of room in the marketplace for a long-time respected brand such as Snorkel.
Don’t expect miracles overnight. To start with, Ahern had to travel extensively and internationally, repairing relationships with various vendors and suppliers, some of which hadn’t been paid for a long time. He’s worked on rebuilding Snorkel’s parts inventory, a task that will also take some time to complete. Getting manufacturing back up to speed, moving forward with new machine development, re-establishing service support capability — all will take time, although when you talk with Ahern you can see he is committed to moving fast. It’s premature to talk about some of his plans, but not for long.
He also is committed to taking care of the needs of rental companies particularly. Of course Ahern Rentals competes with many of them, but Ahern expresses a strong desire to support them as a manufacturer and partner.
When I first met Don Ahern, he owned one rental center. Now he owns 80, along with a manufacturer of high-end forklifts and attachments, delivery trucks, ramps and truck beds, modular cubes and now nearly 50 models of scissors and boomlifts. He feels Snorkel offers a great opportunity for independent rental companies, which is where his roots are. He is a strong believer in providing after-market service and parts support and is committed to building up Snorkel’s capability in these areas.
Ahern has never shied away from challenge or risk, nor does controversy faze him. Just as I would not have bet against him in his bankruptcy fight, I wouldn’t wager against him in this venture either. Don’t be surprised if Snorkel surpasses expectations in the coming years.
