RERMAG

Compact Power to Partner with Home Depot on Larger Equipment

ATLANTA — Compact Power, a manufacturer of landscaping and compact construction equipment, has reached an agreement to operate Home Depot's large equipment rental business in about 250 southeastern U.S. Home Depot stores, Jim Summers, Home Depot director of pro/tool rental operations, confirmed last month.

Summers told RER that Compact Power is purchasing Home Depot's large equipment — skid-steer loaders, small backhoes and other machines too large to fit inside Home Depot's tool rental departments — and will be adding new equipment to improve the breadth of those categories. “They will service, maintain and deliver the equipment to customers that need that service,” Summers said. “They will make the capital investment and be responsible for all repairs. We will share revenue with them on the large equipment only.”

Summers said the plan is for Compact Power to manage the large equipment fleet in 250 stores concentrated in the southeastern United States by the end of 2010. “This is their core competency, and they have the infrastructure in place to improve the customer rental experience in this category,” Summers told RER. “Compact Power has a national service footprint that aligns with our major markets. They have been servicing our large equipment for the last four years.”

Summers said Home Depot Tool Rental will continue to manage and maintain the company's core fleet of construction demolition hammers, drills, paint sprayers, pressure washers, carpet cleaners, tile saws, garden equipment and other items. He said the large equipment segment is a small part of Home Depot's overall tool rental business that operates in about 1,200 Home Depot stores.

“We did a pilot in Charlotte and what we know is it has improved customer service in that category greatly because of [Compact Power's] ability to keep the equipment maintained, make sure the customer has the right piece of equipment for the landscaping or construction job they want to do, and also the ability to deliver it to the customer, another big plus,” added Summers. “It's a win for both of us and the most important thing is that the customer will get serviced properly.”

Summers said the do-it-yourself tool rental business has been strong in 2009, while the professional contractor rental business has struggled during the recession.

Compact Power, based in Fort Mill, S.C., manufactures and distributes compact loaders and attachments, customized trailers for loaders, skid-steer loaders and excavators and other items. Home Depot Rentals, based in Atlanta, is No. 5 on the RER 100.

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