Interview with Charles Snyder: Solutions-Oriented Dialog

Feb. 23, 2011
Charles Snyder has had an impressive career in upper management positions with American Equipment Co. (now AMECO), NationsRent and Sunbelt Rentals. Snyder recently became CEO of Trevose, Pa.-based AmQuip Crane Rental. RER checks in with Snyder one month into the job to talk about the crane rental industry, his first impressions of AmQuip and thoughts about general rental.

Charles Snyder has had an impressive career in upper management positions with American Equipment Co. (now AMECO), NationsRent and Sunbelt Rentals. Snyder recently became CEO of Trevose, Pa.-based AmQuip Crane Rental. RER checks in with Snyder one month into the job to talk about the crane rental industry, his first impressions of AmQuip and thoughts about general rental.

RER: What brought you to AmQuip?

Snyder: I was perfectly happy at Sunbelt. Sunbelt and Ashtead have been terrific, it was a very good place to work, and they’ve been very good to me. In my opinion, Sunbelt has some of the best rental professionals in the industry and it was very exciting being a part of that team. But I got a call out of the blue from one of the private equity companies that owns a piece of Amquip and they had launched a CEO search and somehow got my name, I don’t know how, and things sort of progressed from there. So January 17 I started with AmQuip.

You must have had some familiarity with AmQuip, at least vaguely?

I knew a little about Amquip just being in the industry for so long, and I know a little about the crane business in that at American Equipment we had a pretty sizable fleet of cranes. We were the Grove dealer for the state of South Carolina, we had cranes in a lot of places around the world, and from time to time I had bumped into AmQuip and had actually used AmQuip for some re-rental opportunities here and there. But other than that, I was not intimately familiar with AmQuip. They had for about 40 years been pretty much a northeastern, Philly-based company, and then in late 2006, they acquired a couple of companies down South, Powell Crane out of Atlanta, Elliott out of Nashville, and they started moving south.

Then in early spring of 2007, Bard Capital led a buyout of the company, the founder and former owner and current owner to a smaller degree, Mr. Joe Wesley, sold the company after 40 years. That deal was concluded in the first half of 2007 I believe and Mr. Wesley still owns a piece of the company and remains active on the board.

Your impressions over the first month?

I haven’t been to all the locations yet. That’s what I’ve been working on, trying to get to all the locations as fast as I can. It’s a work in progress for me, learning as I go, but a company doesn’t stay around for 43 years without having some very, very good, dedicated loyal knowledgeable people and that’s exactly what I’m finding. The company has suffered from the recession like everybody else in the rental business the last couple of years, but the balance sheet is in pretty good shape. The crane rental business has not yet bottomed, not like general rental which bottomed about a year ago. Most companies in general rental report that things began to bottom out in February and March of last year. The crane rental business hasn’t seen that bottom yet, and being a later-cycle segment, hopefully the bottom is on its way but it hasn’t arrived yet. I’m thinking we’ll see that sometime later this year.

There aren’t a lot of construction starts these days, what are other areas for AmQuip Cranes?

We’ve got three divisions. We have a tower crane division, we have a rental division where we rent both bare and with operators and riggers when the customer requires it, and then we have a taxi crane division, which is basically one- and two-day deployments of cranes with operators and riggers to make engineered lifts. The taxi crane business is less tied to new construction starts; it’s really more tied to maintenance, repair and small-project capital spending. That business is, except for the weather situation, pretty steady. We got hammered pretty good in January with all the bad weather across the country, but as soon as things warm up and start thawing out, then the phone starts ringing again and the taxi business picks right back up. The phone will ring, the customers will be calling, ‘Hey we need you to come out and take a look at this lift, we need to make a pick next week,’ and we’ll send a technical specialist out. They’ll take a look at the lift plan or help develop the lift plan with the customer. We schedule a deployment of the correct crane with riggers and an operator and we’ll go out and make the lift.

For example, in a lot of our locations we store air-handling units for customers on our yards, these are new air-handling units that have gone up on the roof, and then the old units that come down, we take them back to our yard and ultimately they’ll be sold off or sent to the landfill or whatever. So that’s one example of the requirements of the taxi business. Earlier this month we had every crane we owned in the Boston market deployed out to big-box companies, like Lowe’s, Home Depot, Kohl’s, and we were lifting skidpans full of snow and ice off the flat-top roofs, to prevent cave-ins from all the snow and ice up in the Boston area. It’s a pretty interesting business.

What are some of the differences between crane rental and general rental?

General rental is to some degree more transactional in nature, where a customer calls and says I need a 6,000-pound telehandler for a week, what’s your rate? What I’m finding with AmQuip and in the crane rental business is it’s a lot less transactional and it’s more of a solutions-oriented dialog between the customer and ourselves in terms of developing the most cost-effective lift solution for the customer. And we interact with the customer a lot in that regard as opposed to a customer simply calling and saying ‘hey, send me a 100-ton crane.’

In our tower division, we’ve got 3-D CAD software, we employ a degreed professional that helps customers design various lift plans and configurations and physical site layouts, we’re working hand-in-hand with the customer on swing radiuses, how many cranes are needed to cover the site, where should they be placed, how tall should they be, some of the FAA requirements in terms of the surrounding airport clearances and night-lighting of the tower cranes, and things of that nature.

So you’re going out and meeting with branches and key personnel, same way you’d do it anywhere really?

Not much difference there, I’ve been out meeting all of our branch managers, all of our employees, and in every location I go to I try to meet with customers so that I can understand what they are up against and how they view AmQuip and what we can do to deliver better service than what we’re currently delivering.

Do you have any particular goals for the company or is it premature to talk in those terms?

It’s pretty much along the lines of where we’ve been in general rental at Sunbelt and Ashtead, and not unlike the general rental industry. We’re working on strengthening our balance sheet, re-configuring and de-aging our fleet, and we’re looking for opportunities to improve our geographic footprint. Then, last but not least, we’re looking for ways to improve our service offering and the execution of that service offering to our customer base.

An interesting learning curve for you I’m sure.

Yeah! And I’m having a lot of fun with it so far. I’m Week 4 on the job so take it with a grain of salt!

What are some of the strengths you see in AmQuip, compared to some of your competitors although you probably don’t know them that well yet?

I can’t really speak too much about the competition because I don’t know that much about them. But in the RER 100 when you just look at the crane rental segment, AmQuip would fall in around No. 3 behind Maxim and All Erection. From a distance it looks to me like Maxim and All are No. 1 and No. 2 for a reason; they seem to have good people, good fleet, good footprint, and they are good competitors. Looking at AmQuip, it’s a 43-year-old company with great people. We have a good fleet and a pretty good footprint. There are a few holes in our footprint that we need to work on. The one thing that to me stands out is that during this downturn, the board and the owners have done a terrific job of managing through the downturn and managing the balance sheet, continuing to generate positive cash and continuing to pay down debt all along the way. So we’re in a very good position as we hopefully near a bottom here in the cycle for crane rental and begin to work our way back towards better times.

You were very involved with Sunbelt in the development of technology, such as the use of SmartEquip technology. Is the crane rental industry more or less technology-driven than equipment rental? Will you be looking at advancing technological solutions at AmQuip?

I can’t really speak to whether it’s better, worse or same as, it’s definitely something I’m going to be looking at as soon as I get through all the locations, meet all the people, meet my key customers and get a couple of board meetings behind me. That’s definitely on my radar screen, both our IT platform that we use to run the business as well as areas like telematics and Smartequip and GPS technologies. I know that we at AmQuip put GPS on a lot of our cranes in order to be able to track their location and their movements. I’m just not deep enough in at this point to say if we are on par with general rental, ahead of or behind.

What has to happen to reach bottom and get the crane rental industry moving again?

I think it’s in the process now. If you look at things like architectural billings index, that’s a leading indicator, it continues to move higher. If you look at a couple of companies as proxies for the crane business like Terex and Manitowoc — though they both have other products they have very strong components related to the manufacture and sale of cranes — their book-to-bill ratios are up substantially over the past six months or so, their backlogs for cranes on order is up. I realize a lot of that is international demand as opposed to U.S. demand and if you compare that to AmQuip, we’re kind of U.S. only, but it’s a good thing for those indicators to be up. In fact Manitowoc reported a 57-percent increase in their crane backlog. All of those are good indicators of things to come.

Our physical utilization of fleet is beginning to move up, although it’s skewed a little bit with the tough winter that we had, and the other thing we’re watching is crane values in secondary markets, and the crane values in the secondary markets still have not firmed up yet, that’s one thing we’re looking for still. And hopefully we’ll see that here in the next few months.

Any further reflections on the general rental industry and where it’s going in the foreseeable future?

I strongly believe that the rental segment will be a huge beneficiary of the recent recession going forward. Rental penetration should accelerate rapidly as we come out of the recession and return to growth. Customers are becoming more comfortable with rental and the strength of the supply base, which bodes well for all of us in this next cycle.