Much has been discussed in recent years about manufacturers creating their own rental channel and few have done it more effectively than pump manufacturer Thompson Pump. But calling Thompson Pump a manufacturer that created its own rental channel is not an accurate description of what Thompson is all about.
While many rental people know Thompson as a manufacturer they see at rental shows, many don't realize that Thompson Pump was a rental company before it was a manufacturer, and rental services account for about 80 percent of its revenues. Founder George Thompson was a kind of tinkerer and inventor, who himself performed pump services while working on developing his own pumps. But Thompson's approach to manufacturing was not that of somebody developing or fabricating a product and then trying to market it. Thompson began manufacturing because he couldn't find the right pumps on the market for the applications he wanted to perform, and as he got into rentals, he wasn't happy with the products that were available and decided to make his own. Thompson Pump has since become known as a high-quality manufacturer of highly specialized pumps, but it essentially started out as a rental company and continues to be one first and foremost.
Thompson's presence in the rental market has spread across the country. While it sells a lot of product to United Rentals, Cat Rental Stores as well as smaller rental companies, Thompson has found the rental/manufacturing formula that works. Thompson isn't trying to compete with those rental companies, in fact it tries to avoid it. The typical United Rentals or Cat Rental Store customer is a contractor that specializes in some aspect of construction but needs to do some pumping as part of a job, whereas the typical Thompson customer is a dewatering or wellpoint contractor that specializes in that area. Thompson often re-rents to rental companies, offering the kind of pump expertise that general rental specialists wouldn't have, or works with them on a shared rental basis.
While researching this month's cover story on Thompson Pump, I had the opportunity to interview its CEO Bill Thompson. During our conversation, Thompson emphasized strongly the growing importance of rental in North America and globally. Thompson, who grew up in the pump business and worked closely with many rental companies as a supplier and partner on projects, reflects his company's profound commitment to the rental concept, which he sees as growing. He maintains contacts with many contractors and finds that the numbers embracing rental are on the rise. As he says, contractors think about tax laws, depreciation concerns and future utilization forecasts, and when they weigh those issues along with their ability to properly maintain and support the equipment, the overwhelming evidence supports the growth of rental.
Thompson — who along with his father George, and his late brother George Jr., grew the company with the philosophy of cooperation with rental companies rather than competition against them — has been observing rental companies for decades and has some definite views of what makes this industry successful. Also viewing rental companies from the point of view of a manufacturer, Thompson says he would like to see rental companies make strong commitments to service, maintenance, support and spare parts availability, and is concerned that not enough are willing to make the commitment required to offer those services and guarantee quality. He also urges rental companies to take advantage of the training that manufacturers offer. He has seen, and other manufacturers have spoken of the same problem, rental companies saying they want the training, but when it is offered, they find themselves too busy to accept it. It is hard to spare personnel when business is hot, but in the long run that training will serve rental companies very well and will make up for any lost time during busy weeks.
As for Bill Thompson's positive thoughts on the potential for future growth of rental, I couldn't agree more. But I also believe that that growth can only go hand in hand with the quality of the service rental companies offer. Every time a rental company offers quality service, with equipment that is well-maintained and the knowledge and expertise to help customers solve problems, the potential for the whole industry increases. But when shoddy indifferent service and equipment are offered, the opposite occurs. And that choice is made by every rental center on a daily basis.