What is Equipment Rental ERP Software?

InTempo Software

If your equipment rental company isn't currently using an ERP system, you may be wondering what all the fuss is about. After all - spreadsheets, whiteboards, paper-based inspection reports, manually created invoices, and maybe even QuickBooks have been working just fine all this time...right? 

Maybe so, maybe not. But the truth is - as your equipment rental company grows from small business to mid-market business or even to a larger regional chain, it's important to keep everything organized. That's where specialized ERP software comes into play.

What is an ERP System?

Let's start with the basics.

• ERP is short for enterprise resource planning. 
• ERP software refers to any all-in-one platform that you can use to manage all aspects of that "enterprise" - whether it's a one-location power tool rental shop or a multi-location construction equipment rental business. Consider it your "single source of truth".
• ERP software was first developed in the 1960s to manage manufacturing processes, including production planning, scheduling, and inventory control. The 70s brought a shift of focus in technology toward hardware and PCs. As the software and hardware experienced explosive growth, coupled with fears around the year 2000, many companies invested in higher-level software to protect their data and grow their business.
• The goal of ERP software is to consolidate end-to-end processes on one system to make your employees more efficient and your company more profitable.

That said, there's an important distinction to make between ERP and non-ERP software. Several rental software systems can handle all of your operational tasks, like creating reservations or scheduling machines for service. However, non-ERP software doesn't include the accounting/financial side, which means you'll need a separate third-party system for Accounts Payable, Accounts Receivable, General Ledger, and Depreciation. It's entirely possible to run your equipment rental business with non-ERP software + a separate accounting system, but it does make things harder. (Learn more about why you should be using rental-specific accounting software.)

Real-Time Functionality

Real-time updates are another important distinction between ERP and non-ERP software. If a solution calls itself an ERP, that implies that it operates in real time. When a sales rep creates a contract, your yard team can see that same contract and start staging the reserved equipment. When a driver picks up a damaged machine, your maintenance team can start preparing for the repair. Everyone stays on the same page; it's an easy way to connect the dots from the counter to the back office. 

ERP Software for the Rental Industry

Some ERP solutions are "industry-agnostic". That means that companies in any industry can use them to run their business. 

Of course, the equipment rental industry is truly unlike any other industry, which means that non-rental-specific ERPs may not have the functionality you need to run your business. For instance, a generic solution may not be able to accommodate checking inventory in and out or cycle billing your customers. That's why it's helpful to invest in equipment rental ERP software that can support your unique processes.

Let's do a quick exercise:

• Raise your hand if your software can handle both rentals and sales. 
• Keep your hand raised if you can track the constant relocation, repair, and disposal of all of your equipment. 
• Keep it raised if you can track parts and merchandise in the same system.
• Keep it raised if you can fully account for inventory via cycle counts and spot counts. 
• Keep it raised if you can create scheduled maintenance steps by equipment type and keep logs. 
• Keep it raised if Accounts Receivable, Accounts Payable, and General Ledger are all unified. 
• Keep it raised if you can instantly drill into customer transactions when revenue increases or decreases. 
• Keep it raised if you’re able to pull the reports you need for real-time insights into equipment utilization, return on investment, and profitability.

Is your hand still raised? Congratulations - you're unlocking the full power of a rental ERP. Hand down? It might be worth finding a system that'll help you grow.

Who Should Use Equipment Rental ERP Software?

You may think that ERP systems are only for the large "household name" rental chains, but that couldn't be further from the truth. ERP isn't just for the big box stores; the technologies are a great way for small to medium businesses - even those with only one or two rental yards - to optimize their businesses and level the playing field with larger competitors. In fact, these local and regional companies make up the largest-growing segment in the equipment rental ERP space.

If you're just starting out, it may make sense to choose a streamlined solution that keeps things simple. However, once your business starts to grow, it's worth considering a specialized solution. The larger you become, the more important cross-department communication becomes; the same goes for the standardization of your processes. It's often around the $4-5 million mark (of rental revenue specifically) where companies start to see the best return on investment. 

ERP Software for Small Equipment Rental Businesses

Even if you aren't at that $4-5 million mark just yet, rental software that's purpose-built for small businesses can still help you get similar benefits at a lower cost. Even brand-new start-ups can reap the benefits of digital dispatching, quotes and contracts, delivery scheduling, customer notifications, e-signatures, and more.

Some vendors also provide pricing structures to accommodate businesses as they grow. That means that you can get started on one solution, then add more modules or locations as your company grows. 

Does Industry Matter?

Generally speaking, companies with high-value assets (such as construction equipment) benefit most from these solutions. Sub-industries like aerial and access equipment, pump and power equipment, and specialty (oil and gas, shoring, modular) equipment all find great value from ERPs.

Check Out InTempo's Equipment ERP Software

InTempo Enterprise is perfect for consolidating service and rental and accounting all in one place. (It even offers similar functionality for your dealership sales department, if you have one, so you can manage both sides of your business on one platform.) With all-in-one base functionality and a variety of optional modules to help you as you grow, we're proud to be the last rental software you'll ever need.

Want to see our equipment rental platform in action? Contact us today or request a free demo.