ARA helps company grow by expanding its view and way of operating
By Connie Lannan

ARA helps company grow by expanding its view and way of operating

Francis Hester

When Captain Hook Dumpster Rentals began in Austin, Texas, during 2001, there weren’t many similar roll-off dumpster rental companies in the market. Now,
21 years later, that scenario has changed completely. To stand out among the fierce competition, grow revenues and become an employer of choice, company leadership reimagined their business and gained a new set of tools, thanks to the American Rental Association (ARA).

That transition began in early 2020. “I was trying to do something new to compete with a growing tide of competitors — trying to find ways we could stand out,” says Francis Hester, CEO. “It occurred to me that there is a huge portion of our business that is actually equipment rental. Honestly, I had never considered that before.”

But Hester didn’t know much about the rental industry. “I really had no idea how a rental company made money, how they look at business, what their key metrics were, etc. I started to do some research. I studied the ARA’s white papers, the materials on RentalU and other free content that the association published. We didn’t consider ourselves a rental business before. We considered ourselves a waste business. We started to realize we are actually both,” he says.

This realization was revolutionary, admits Elaine O’Gorman, president. “No one in our business thinks they are in the rental industry. It was a mind shift — absolutely a lightbulb moment,” she says.

That shift made Hester and O’Gorman seek out potential advisers with rental industry experience to help further deepen the new role that rental was playing in their business.

“I was put in touch with Josh Nickell [ARA vice president, equipment segment]. From the first conversation, it was obvious we were on to something. Not only did the ARA have great written resources but also a wealth of experts who were willing to share their business expertise,” she says.

The Texas Rental Association Roundup offered the opportunity for a face-to-face meeting with both Nickell and James Auerbach, ARA vice president, event segment and rental industry workforce development, about their business. “We knew we needed to be more ‘rental.’ Every time we did more things that were more rental, we saw more success. When we sat down with them, it was one of those lightbulb moments again,” she says.

That conversation sealed it. Hester and O’Gorman immediately joined ARA and started taking advantage of everything membership offered.

“We totally changed the way we look at our company,” Hester says. “The things we thought were important were not as important, and the things we had overlooked were important now. It has helped us identify key metrics, make informed purchasing decisions and know when to hire. It is a completely different way of looking at the business.”

Asset utilization metrics, which were new to the company, turned out to be particularly revolutionary.

“If you ask most dumpster rental companies how they decide when to buy more dumpsters, they do nothing more sophisticated than look out in the yard and see that there are no dumpsters available, but the phone is still ringing. Then they say, ‘I guess I should spend $100,000,’” O’Gorman says.

“With the set of tools that came from RentalU — and looking at things like dollar utilization and time utilization — we now have financial measures that tell us how many dumpsters we need to buy and when, and exactly when they will get paid off. The amount of control we have over the business, thanks to the analytics we learned from the ARA, has made an enormous difference,” she says.

Hester and O’Gorman also changed their processes. “Running a rental company is different than running a waste company. From ARA resources, we learned about the check-in and checkout processes for assets, how to make a return over the life of the assets, pricing methodology and a lot of other things,” Hester says.

The results speak for themselves. “We went from a solid member of the dumpster rental community in Austin to amazing gains in terms of profitability and growth. We have seen pretty consistent growth of 50 percent to 70 percent year over year each quarter since we put those changes in place — and without growing the asset base. More importantly, we went from moderate cash flow to extremely strong cash flow. Even the feel of the business has changed — from frantic and manic, go-go-go to a steadier and more stable tempo,” O’Gorman says.

When they first started implementing changes, their employees “thought Francis was crazy,” O’Gorman says.

“There were a lot of nervous folks because nobody does it this way,” she says. “They thought we would lose our customers. But, instead, they saw an immediate positive. Customers found our new pricing to be competitive and fair. And we don’t have to push our drivers to turn the equipment over and over again because even when assets are sitting at a customer site, they are collecting appropriate rent. It is a much more pleasant work environment. It shows in our retention statistics. Customer retention is fantastic, and we have become an employer of choice in our sector.”

With all the improvements they have experienced, both Hester and O’Gorman knew they had to attend The ARA Show™ 2021 in Las Vegas during October.

“The ARA Show was an incredible and amazing experience — very eye-opening with one lightbulb moment after another,” Hester says. “We met so many wonderful people. In talking with them, we learned so much about rental businesses, the rental industry and where it is going.”

“When we first started understanding how ARA was structured, we looked at the equipment side,” O’Gorman says. “We didn’t pay a lot of attention to the event side because, obviously, we are renting equipment. At the show, we realized how much value there is in understanding how the event rental side of the business works as well. It was something we would have probably ignored if we hadn’t gone to the show and heard people talking. We realized our business is, in many ways, very much like event rental. Having both of those sides together, we learned things that we probably wouldn’t have been able to learn had we not been to the show.” 

Connie Lannan

Connie LannanConnie Lannan

Connie Lannan is special projects editor for Rental Management. She helps plan, coordinate, write and edit ARA’s quarterly regional newsletters, In Your Region. She also researches, writes and edits news and feature articles for Rental Management, Rental Pulse, supplements, special reports and other special projects. Outside of work, she loves to bake for others, go for walks with her husband and volunteer for her church and causes she believes in.

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