Digital technology has given rise to the sharing economy with examples such as Uber, TaskRabbit and Getaround, but business-to-business (B2B) sharing has been commonplace in industries such as agriculture and forestry for years. It certainly wasn’t unheard of in the construction industry during booms. However, in the current economic environment, the B2B sharing economy has become increasingly attractive to both owners and renters.
Colin Evran, founder of San Francisco, Calif.–based Yard Club, sees a future for the sharing economy in B2B industries where the investment in specialized heavy equipment can exceed $1 million, such as construction, manufacturing and farming. His online equipment rental service helps contractors maximize the return on investment for their heavy equipment fleets. The service benefits the contractors who earn income on idle equipment and the renters who can’t invest in expensive equipment because of uncertainty over future contracts.
Cat joins the Club
With strategic financing from Caterpillar in 2015, Yard Club developed an online rental platform that includes both Cat and non-Cat equipment and launched the service in targeted U.S. and Canadian metropolitan markets. Finning Canada, one of the main Caterpillar dealers in the country, “saw how the increased utilization on contractors’ fleets would make their customers more successful,” Evran says.
Ehtisham Anwer, director of heavy rentals and used equipment at Finning Canada, helped roll out the pilot of the technology application. “There are two sides to the Finning–Yard Club offering. The first is the Finning rental management application that any customer can access—and the entire experience can be done online. The other piece is a contractor-to-contractor service, which is invite only. Both have been very well received,” he explains.
For the rental-management side of the service, the technology allows customers to gain access to Finning Canada’s rental inventory. Customers can easily manage all their equipment from Finning Canada online. Rentals can include both operator and equipment or equipment alone.
For the invite-only, peer-to-peer offering, the club members gain access to web or mobile phone technology used to locate and request contractor inventory, list their own fleet for rent, and receive and provide quotes to other invite-only member contractors.
Members agree just once to a master rental agreement that covers all parties. The comprehensive agreement clearly outlines insurance requirements, responsibility for equipment, damages and indemnity. The platform has been designed to be a one-stop shop; it even allows members to invoice each other and make and receive payments.
After launching to select customers in Alberta and B.C. in April 2015, the application has started to gain momentum. It has even helped some customers make decisions about purchases. For example, a Grande Prairie, Alta.–based customer did not have an immediate need for a piece of heavy equipment, but with the help of Anwer and the Yard Club application, he decided that he could just rent out the equipment and earn revenue until he needs to use it himself.
Daveida Quinn, operations manager of assets and equipment with Pacific Blasting & Demolition, a division of Canadian-owned NorLand Limited, needed to source equipment in Edmonton for a demolition contract. Using the application from the company’s headquarters in Burnaby, B.C., she booked a CAT 336E from ConTrac Equipment, a local Edmonton company and Finning customer. “Yard Club was very user-friendly and straightforward for our rental. We put out a request and within moments had multiple replies back. We used to scour the Internet for equipment rentals when we had to work in a new city. Now we will use Yard Club,” Quinn says.
Finning Canada plans to further expand the invite-only, peer-to-peer offering in Alberta and B.C. later in 2016.
New to the market, AnyQuip offers the local construction industry another equipment-sharing option. Co-founded by Steve Skiba, the owner of North Star Contracting, this made-in-Alberta service grew out of his dismay at seeing his own equipment sit idle after the economic downturn. He teamed up with tech-startup entrepreneur Clark Johannson to create a secure, user-friendly platform allowing owners and renters to connect.
To become a member of AnyQuip, both owners and renters must demonstrate eligibility. Each member must provide corporate details, verification of insurance coverage, equipment conditions of use and payment ability. “These are very expensive pieces of equipment,” says co-founding partner and chief marketing officer Jennifer Lussier. “You don’t just rent million-dollar equipment to anyone. We protect our contractors and their equipment. Members must qualify.”
Once approved, members may list their equipment from their desktop or smartphones by choosing from a database containing more than 94,000 models of equipment. AnyQuip will optimize contractors’ listings by supplementing them with key equipment specifications and by offering calculation tools for setting pricing based on true costs of ownership. The application enables contractors to manage their fleet by setting prices and specifying rental preferences.
On the rental side, members may search through thousands of types of equipment, using filters such as distance, size class, attachments and accessories. Renters can request equipment be transported to their job site and can also specify if an operator is needed as well. “Since AnyQuip is based on a trusted community of members, all members are accountable through a transparent ratings system. Those with the highest ratings post in the top of the search pool,” Lussier says.
The team at AnyQuip knows they are not the only game in Alberta and that others will be trying to cash in on the sharing economy during the recession. What will set AnyQuip apart will be price and the brand variety, Lussier believes.
“Some rental businesses are trying to maintain the premium prices you would see during boom times. We’re providing a disruptive solution, which means our prices will be considerably lower than some other options,” she says. “We’ll also strive to offer a variety of different brands.”
AnyQuip officially launched in February 2016, and so far it has reported 300 per cent compounded monthly growth in both members and equipment listings. “We’re proud to offer our members an innovative solution for improving their profitability, as well as alternative to the auctions that we’re seeing so much of these days in Alberta,” Lussier says. “I think three years from now, we’ll be seeing equipment rental on all contractors’ revenue forecasts.”