Trends, Innovations, Trusts and Dictators

Feb. 1, 2007
In January 2004 we published a feature story called 25 Trends That Might Matter. Based on interviews with more than 50 rental people, manufacturers' reps,

In January 2004 we published a feature story called “25 Trends That Might Matter.” Based on interviews with more than 50 rental people, manufacturers' reps, manufacturers, industry analysts and service providers, we took a look at 25 trends that looked likely in the rental industry. We never claimed it was complete or scientifically guaranteed to be accurate. It was a look at likely trends according to what industry participants expected, coupled with the observations of our staff.

From the response of readers, that article was a popular one, and we've received quite a few requests to repeat it. And so this month we are, based on a new round of interviews. We're offering 35 this time. Some of the trends are repeated because they still relate; others are new. We at RER consider our coverage of industry trends to be ongoing, so if we miss something here, it doesn't mean we have to wait three more years before we write about it. But we consider this a good barometer of where the industry is heading because our readers themselves have told us.

In this same issue, we look at other industry trends from a variety of angles. Interviews with consultant Dan Kaplan and Terex CEO Ron DeFeo shine spotlights on future trends, and research specialist Frank Manfredi brings us up to date on the industry's growth and what to expect in 2007.

Also, senior associate editor Katie Eagan offers insight into additional reader surveys conducted by RER's research department on what 2007 will bring. And consultant Gary Stansberry offers tips on what you need to know about your business to properly value it, whether you want to sell it or not.

One of the most intriguing stories of the young year is the situation being faced by Stephenson's Rental Services, Toronto's leading rental player. Last year, Stephenson's grew its market share with the acquisition of its leading competitor and appears to have what it takes to be a successful regional rental company.

However, recent changes in Canadian law have increased the tax burden on income trusts, which previously were able to avoid most corporate taxes by making regular cash distributions to shareholders.

Stephenson's is currently undertaking a strategic review to determine the best course for its shareholders. Its board will have to determine its viability as an independent public company and the ramifications of its decisions will be of interest to many in the industry.

In recent months, we inaugurated a new column called “Innovation on Rent.” The column has covered a drive-through service by Tiffin Rental, an equipment modification on scissorlifts undertaken by Skyjack and Knopp Equipment, and Gap Power's solution to space limitations.

We plan to continue to present innovations by rental companies from the smallest to the largest. A small innovation by a small rental company might be as significant as a major one by a giant company. All sizes and types of innovations can help others find ways to operate more productively. Our interest is to celebrate innovation in an ongoing way and we are eager to hear of your innovations, so please continue to contact the RER staff and tell us about them.

According to various press accounts, Home Depot staff, from management to associates in the stores, were literally slapping each other with high-fives at the news that CEO Bob Nardelli was leaving. Even though profits and revenue soared during his tenure, by many accounts Nardelli's style was dictatorial, autocratic and even abusive, alienating much of his work force. There was much criticism of his annual compensation, even before the company announced his $210 million severance package.

In his case, I only know what I heard and read, but personally, I'm a believer in positive reinforcement and encouragement as a management style, as opposed to a “my way is the highway” negative-motivation approach. I believe human beings work better when their ideas are respected and valued — if not always implemented — and when they are treated with appreciation. One of the trends we didn't mention in this month's cover story is the importance of working environment and how, to many employees, being respected (as well as getting good benefits packages) means as much, if not more, than salary. A positive, inclusive team approach will bring far better results in the long run than a negative approach that doesn't recognize valuable contributions from personnel.