The Big Get Bigger and So Do The Small

June 1, 2005
We've been saying all along that consolidation is not over and if you take a look at our Industry News section this month, you'll see what I mean. The

We've been saying all along that consolidation is not over and if you take a look at our Industry News section this month, you'll see what I mean. The stockholders of Neff Rentals approved the company's acquisition by Odyssey Partners, and I expect that increased capital will make Neff more of a national power. Sunbelt Rentals, the fourth largest rental company in North America in volume, and one of the largest in reach with more than 200 locations, got a little bigger by buying the South Florida branches of HSS RentX. And United Rentals, although no longer making acquisitions, has been quietly starting up new branches and supply distribution centers.

As readers of our RER 100 issue last month might have observed, the RER 100 increased by 12 percent year over year. But the larger increases were not by the top 10 or 20, they were primarily by independent rental companies and Caterpillar dealerships. Of the roughly 20 companies that increased rental volume 20 percent or more, about 40 percent were Cat dealers, 40 percent independent rental companies and 20 percent other dealers or manufacturer-owned rental companies. Of those posting 20-percent increases, only three ranked in the top 20.

That said, the top 20 did quite well also. But while the big get bigger, the small certainly aren't getting smaller. When we factor in our conversations with smaller, independent rental companies around the country, we see the independents are profiting just as much from a favorable economy and the current surge in construction as the larger players are. And judging from the number of calls I receive from people wanting to buy into this industry and start rental companies, this is still a very good business to get into.

It takes more capital investment than it did years ago and more serious thought and preparation. The level of business knowledge required to succeed in this far more competitive environment is more sophisticated than in the past. But the rewards are still out there for those willing to make the commitment and do their homework.

When I first began covering the rental industry in 1989, one of the first people I met was Mitch Gutierrez, CEO of Orbit Rentals in Santa Fe Springs, Calif.

I've met with Mitch many times over the years, mostly at rental shows or California Rental Association chapter meetings and I also wrote a feature story on Orbit Rentals. And I've had many a conversation with him about the rental business and also about life.

It is more about life than the rental business that leads me to write about Mitch this time. Unbeknownst to me until he recently called to tell me, Mitch has had leukemia for three years and will be undergoing a bone-marrow transplant. He'll be entering the hospital June 12, so by the time this issue reaches your hands, he'll be in preparation or will have undergone the procedure, which, his doctors say, has about a 90 percent chance of curing his cancer, and about an 80 percent chance of him surviving the procedure. Those odds are a little disconcerting, but they're a lot better than the alternative, which is to do nothing, and I needn't tell you the results of that.

When he told me about it, his voice reflected the same positive spirit and confidence Mitch has always had and those of you who know him know he's one of the nicest upbeat guys you can meet. When he hung up the phone, he said, “See you soon,” not “Goodbye.” That's typical of Mitch.

Mitch has always been active in association work, helping however he could, and now it's time to help Mitch. He'll need blood and platelet contributions, which can be donated through the City of Hope hospital in Duarte, Calif. For information on how and where to donate and updates on Mitch's condition, please contact his wife Magda at (909) 983-1472, his sister Rachel Kidder at (562) 696-8875 or check out his Web site at: The site requires registration and approval to gain access, and you must also know the CarePage name, which is MitchG.

Originally this operation was scheduled to take place in April, and when CRA spread the news, a number of rental people showed up to offer blood. There are ways to do it long distance as well.

We'll offer updates on Mitch's condition in RER. And we'll be seeing him soon.