Damage expenses are a standard line item in any rental or leasing company’s income statement. When it comes to the construction equipment rental industry, this line item can take a major bite out of company profits. Yet it’s a problem savvy companies are finally learning how to overcome.
The Heavy Cost of Damage Expenses In The Construction Equipment Rental Industry
The construction equipment rental industry is perhaps the hardest hit rental and leasing industry when it comes to paying for damages. While every asset rental and leasing company deals with damages as part of their everyday business, the nature of the construction equipment environment makes it especially prone to such issues.
- Cost of Replacement Parts: Replacement parts for construction equipment can be so specialized that it can cost several thousand dollars to repair. While a replacement tire for a medium duty truck can cost a few hundred dollars, a replacement tire on a bulldozer can cost a few thousand dollars.
- Opportunity for Major Damage: Construction sites are known to be dangerous places for both people and equipment alike, sometimes leading to major equipment damage. Additionally, since equipment is often left unattended overnight, it can fall prey to graffiti and other vandalism.
How Newman Tractor Started Saving $7,500 In Damage Expenses Per Month
As a construction equipment rental company, Newman Tractor managed equipment that cost between $100,000 – $350,000. With such valuable assets under their roof, the Newman team was focused on keeping their equipment in the best shape possible, a challenging prospect since their equipment was regularly sent out to construction job sites where it often took a beating.
When equipment came back damaged, it could cost Newman Tractor as much as $5,000 to repair. That’s why the team knew condition documentation was so important. Xavier Vela, the company’s Rental Coordinator told us the team first tried using a digital camera to take photos prior to each rental to record the asset’s condition. But, it was a cumbersome process. It could take 15 minutes just to download the pictures and store them with the original rental record. Additionally, the team was still left unprotected from damage disputes because the photos failed to capture every part of the machine.
Implementing Record360 has changed this process entirely. By moving their offline workflow into Record360, and using the app to record pictures and videos of the equipment before and after each rental, the team has cut documentation time in half. But, perhaps more importantly, Xavier shared with us that the improved documentation has let them cleanly resolve 2-3 additional damage disputes per month, saving them $7,500 per month in damage expenses they used to pay out of pocket.
READY TO SAVE THOUSAND OF DOLLARS EACH MONTH ON DAMAGE EXPENSES? Contact us at email@example.com to see how in just a few hours, you can get Record360 up and running in your organization.