Businessmodel of United Rentals

Customer Segments

United Rentals has a segmented market business model, with customer groups that have slightly different needs:

• Commercial Construction Companies – Companies that use equipment for constructing and renovating commercial buildings, warehouses, industrial and manufacturing plants, office parks, airports, residential developments, and other facilities.
• Industrial Companies – Manufacturers, chemical companies, paper mills, railroads, ship builders and utilities that use equipment for plant maintenance, upgrades, expansion, and construction.
• Residential Customers – Homeowners and other individuals that use equipment for projects that range from simple repairs to major renovations. ### Value Proposition

United Rentals offers four primary value propositions: accessibility, convenience, cost reduction, and brand/status.

The company creates accessibility by providing a wide variety of options. It offers over 3,300 classes of rental equipment, which includes general industrial and construction equipment, trench safety equipment, aerial work platforms, power and HVAC equipment, pumps, and general tools and light equipment. The products can be rented on a monthly, weekly, daily, or hourly basis. The company also provides a broad set of related services, ranging from online management tools to custom onsite specialty solutions.

The company offers convenience by making life simpler for its customers. Its clients can order equipment 24 hours a day, seven days a week through its website. They can also use its UR Control application to manage the rental process and view real-time reports on business activity. Lastly, they can use Total Control, a proprietary software application that allows them to manage and monitor all of their equipment needs. It can be integrated into their enterprise resource planning systems.

The company reduces costs by saving customers up to 35% on annual rental costs on average, thanks to its advanced fleet management system.

The company has established a strong brand due to its success. It bills itself as the largest equipment rental company in the world, with a store network nearly three times the size of any other provider. It has a network of 890 rental locations in 49 states and 10 Canadian provinces. It is a memberof the the *Fortune *500, Russell 3000 Index, the Barron’s 400 Index, and the Standard & Poor’s 500 Index. It holds a 13% share of the equipment rental market in terms of revenues, the largest share of any firm in that segment. Lastly, it has won many honors, including the following:

• Recognition as one of the Top 100 Leaders in Corporate Supplier Diversity by Women’s Enterprise
• Access Industry Employer of the Year and Access Safety Innovation Awards from Access, Lift, & Handlers
• Recognition as one of the Top 30 Champions of Diversity by Diversity Plus
• Recognition as a Top 100 Military-Friendly Employer by I. Jobs Magazine ### Channels

United Rentals’ main channel is its direct sales team. The company promotes its offering through its website, social media pages, advertising (TV/Internet/radio/trade publications), direct mail marketing, sponsorships, and participation in trade shows, conferences, and promotional events.

Customer Relationships

United Rentals’ relationship is primarily of a self-service nature. Customers utilize its products and services while having limited interaction with employees. That said, there is a personal assistance component in the form of phone and e-mail support.

Key Activities

United Rentals’ business model entails purchasing and renting equipment to its customers, as well as providing associated services.

Key Partners

United Rentals’ key partners are the suppliers that provide the equipment and supplies that it rents to its customers. It aims to have the minimum number of suppliers per equipment category that can satisfy its anticipated business requirements and volume.

Key Resources

United Rentals’ main resources are its physical resources. These include its rental fleet of 7,900 vehicles and 500,000 individual units of rental equipment. They also include its 897 rental locations worldwide, 775 of which are in the U.S. and 122 of which are in Canada.

Cost Structure

United Rentals has a cost-driven structure, aiming to minimize expenses through significant automation and low-price value propositions. Its biggest cost driver is cost of equipment, a fixed cost. Other major drivers are in the areas of sales/marketing and administration, both fixed costs.

Revenue Streams

United Rentals has two revenue streams: revenues it generates from rentals and sales of new equipment to customers.