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 Managing Multiple Locations

Posted on: 3/31/2022

This is dialog from a Peer Talk episode between Dan Crowley, President of Peer Executive Groups and Dan Fielitz, Owner of General Rent-All, OH.

Dan Crowley: Welcome to peer talk today, we have Dan Fielitz from General Rent – All. Welcome Dan! Today’s topic, we are going to be talking about managing multiple locations which is something that Dan is very familiar with. Why don’t you tell us a little bit about your journey, how you got into the industry, your company, and how you got to this point. So we can learn more about General Rent-All.


Dan Fielitz: Hi Dan, how are you doing today? First, thanks for having me on Dan, I appreciate it. Hopefully somebody finds something useful out of this. If you want to tell the story of our company, you have to go back a generation, starting with my dad. So back in 1978, he opened his first-round yard in Wooster, Ohio and he was a farmer that needed a set of acetylene torches

and he couldn’t find them anywhere. That was kind of the birthplace of that. So, he went into business, got a family loan from a friend with an industry that we actually deal with in the manufacturing industry. I was born in 1979, so I’ve been around this industry my entire life. He sold out to VC guy back in 1992, which then sold the company off to nations rent, which then sold that to Sunbelt.


DF: Along the way, they closed down some of the locations in our area. He had grown it for the next fellow, then grew it out to seven locations. By the time Sunbelt was done, they were all closed. That left a vacancy in our area. Just for perspective, we’re about an hour south of Cleveland, about an hour and a half Northeast of Columbus, kind of right along the route 77 US 30 corridor is where we are. We bridge a really interesting area there where we’re not exactly urban. We’re not exactly agricultural. We’re somewhat industrial. We got Republic Steel from Timken in our area, which are big manufacturing companies in our area. We have a nice mix, but we’re not too heavy in any one area.


DF: So then in 1996, we were approached by a small operator in the Massillon Ohio area. This would be the sister city to Canton, Ohio which is the pro football hall of fame. That’s the big thing in our area. The father was getting ready to retire and the son had spun off a party and event rental business, and he didn’t want anything to do with construction, homeowner and industrial work. He just wanted the party side and was looking for a buyer. So, I was a senior in high school, and I was getting ready to head out to college. Dad said, “hey, are you interested in this”? I said, “yeah, but I’m 17. What do I know about anything in the world”? Well, I started working there in December of 1996, just to see if it was something that fit well. In March of 97, we purchased the business. In 1999, the Ventrac company which has just recently been sold out to Toro, who are old friends of the family.


DF:Then in 2004, we saw a need and an opportunity in the Worcester area, which is kind of the other direction. So now we have two county seats that we were operating in, Wayne and Stark county in Ohio. That happened quickly and put things in perspective. I’m in my early twenties and it was a real interesting learning curve on that. I was trying to go to college at the same time and we were experiencing this rapid growth and life just kept on happening. I got married and had kids along the way. Then in 2009, my first daughter was coming on and we were getting a new computer system. They had said, “you know what, I’m just not coming in on Monday”, and that was our succession plan. So that pretty much brings you up to where we are today. Things have just been happening. It sounds haphazard, but looking back on it, it’s worked out well so far.


DC: That Wooster location has been operating for 15 years. So that’s actually a good place to start. Your role, at what point were you essentially? Well, I’m assuming you worked with the store managers, you had store managers at each location.


DF: I would operate as the right-hand man to the dad who was a real entrepreneur. He saw an opportunity, he chased it, but that didn’t always lead to an organization where the opportunity presented itself. Let’s go after it and he would be able to lean on me and the type of mindset “how do we make this happen”. I was operating as an assistant manager and then through personnel changes, I was a branch manager at North Canton. Then when we got somebody up there, I went out to Orrville for a while. Then, I just kind of transitioned along the way. One of the things I really realized in 2008 and 2009 was we had to just transition away from John Phillips corporation to general rental. It couldn’t be Banfield’s incorporated or else it would be the same frustrations I had been dealing with all along. So that was one of the early transitions. I put that together in 2002 or 2003.


DC: So about that time is when you came up with the new name and started to brand yourself together as a general rental. Your logo actually looks like it might be younger than that. Did you do that logo more recently than 15 years ago? That looks great. It looks surprisingly fresh. At these locations now, do you have a general manager in each store or a lead branch oversee. Talk about the difference between your role and your general manager’s role. What does that person do for you versus what you’re currently doing? You say you’re referring to the book by Gino Wickman, which is about building an entrepreneurial operating system.


DF: Well, I got to be honest. I got to talk to my sisters about that because I leaned on them heavily for input, since they’re trendier than I am. Now we’ve also added in a general manager to help loosen the burden on me a little bit. If we talk about it in terms of traction, we were trying to build out that model before we had even read the book. Really, he’s operating as an operations integrator.


DF: I think we were already heading in that direction before EOS came on my radar, we were already identifying it. You just have to share the responsibility. We’re not a large organization, we’re 35 or so employees. But at the same time, you spread them out over four different physical locations in a 40-mile radius. You just can’t be in four places at once, so you really have to build out a network of trust among these guys. EOS has taught us that we need to also look for identifying numbers and identify a way to prove how they are doing. If it has to be more than just kind of looking at your thumb and sticking it up in the air and testing the breeze.


DC: That’s excellent and a good point. We’re going to get into metrics a little bit further in the conversation, and I’m dying to find out how you look at progress and performance in those operations. Let me ask you this. If I fly over the business, seeing the four locations, how do they differ from each other? If they differ at all, do they serve? In my mind, you picture an independent equipment rental operator going 10 or 20 miles in every direction, and they might have a category of assets that includes compact equipment, as well as a little bit of lift, and may focus on specific market categories. How are the four similar or different from each other?


DF: They really do operate for individual businesses in closer proximity. We share equipment back and forth a lot. That is one of the struggles, but we have centralized a few things in order to deliver some of our aerials. We’ve put all of our main transportation at one location. So the semi and our tandem rollbacks are sitting at one location. It has the best location for access to the main highway. So you can get in and out pretty quick and easily. Other than that, they really are relatively similar. The differences would come down to the markets that they serve. If you look at Maslen and North Canton, we are in a considerably more urban retail environment. Worcester is similar to that. Orville is out in the middle of nowhere, but we have an interesting oddity there which is having a large Amish population to the south of us. They travel into the larger urban areas like Akron or Cleveland, and they will use us as a way point to pick something up along the way.


DC: Having the trucks in one location and moving some of the bigger assets, you do not seem to have problems with the distance between the four locations. We have people with multiple locations that do different things to become as efficient as they can throughout the day. We have a couple that have what I would call central hubs, where they create a war room and they have a central phone bank where they’re actually keeping track of assets and the movement of the assets. Do your stores own those assets or how is that managed? Is it one central pool of assets and they have a home or is it kind of more all working together as one?


DF: So the business structure, we are incorporated in all four branch locations of one corporation. So at the end of the day, they are all owned by one entity. They do have home-based locations where we probably should do a better job of tracking internal sub rentals, but we share stuff back and forth. It’d be like a glorified stock room that you can take something in and out of. As far as the hub and spoke, we are masculine branch being the oldest, and building wise one of the largest and best suited for it. We do most of our stocking out of there. So we’ll do some centralized parts ordering. We have been working on building out an actual purchasing agent that does a lot of the centralized repair orders and merchandise inventory restocking. We started building that out in January of 2020 and then COVID hit. So things really hit the bricks there and we haven’t built that the way it should be to be fully efficient.


DC: I’ve often wanted to do a very targeted peer group around since that’s our business. I’d love to do a multi-site, how different operators around the country are identifying efficiencies. Whether it be a central service and repair or different things around asset movement and managing of that. I think that it would be really neat to have 10 people in the room and just share for a day on the different things they’re doing to cut some of the central overhead costs out of the equation so that they can be more profitable with four stores than one store. Owning four individual stores is one thing, but you don’t really get the advantage until you start to make changes.


DF: I think communication is the biggest struggle there. This bliss last month introduced a unified communication system where in the past we had four different traditional PBX phone banks at each location. Now we’ve just introduced a unified solution so that we can send calls and forth. We can call extension to extension in house. When we were rolling that out, guys were out of their minds excited about the opportunity to not get away from some of the frustrations since we are so close, when we do share stuff back and forth. If I’m out of a plate compactor at this branch today, well I’ve got one here that’s a 20 minute drive.


DF: “Are you willing to run over there? Sure, you bet ya now, “how do I make that happen inside”? Part of that is a sales discussion and part of it is logistics discussion. We’re talking about, do I want to hang up the phone and have that trust that that customer is going to call that other branch or do not want to make that reservation and then confirm availability with the other branch? Can I trust that this piece isn’t on a repair order and that it is available as it says, or that the scheduling isn’t as tight as I think it is, or that it’s tighter than I think it is. That whole frustration is probably the lion’s share. It’s always communication. Then it would save me from even picking up the phone and dialing in over and going into the on-hold or going into the voicemail. And I can just look in the camera and see how these guys are all on the phone right now. We’re at the expert level, the mid tier level.


DC: It’s so funny because what you’re speaking of, there’s so much at risk. It’s like you could see in any given month the opportunity to botch an opportunity, right? So you want to make sure that happens. I would say one of the interesting things about this pandemic is we are getting exposed to using technology for different purposes. One of our members has three locations in Pennsylvania and when they got to the second and third location, it was such an interesting move. They put these big monitors at the end of each counter and so they left them on 24/7. So, you could literally talk to the counter that might be 30 miles away on your left, or talk to the counter that might be 20 miles in another direction on your right. So these guys would lean in and they’d look in the camera and say, “hey Jim, are you there? Can, can I ask you a question”? I thought that was a unique way to deal with that communication issue.


DC: That’s where you can almost see where this is all headed. The ability to have multiple monitors in front of you, to be able to see multiple stores, and understand what is available to you. I’m thinking of a four store operation, but I’m also thinking of an eight store operation. How does this benefit? Ultimately, there is definitely a time constraint and a distance constraint on managing those operations working together. So you have these different branch managers. Now you have the general manager. You can kind of see that your role from an EOS perspective is to be the visionary and the use of the general manager may be in an integrator or an implementer role. Is that kind of how you are structured or are you using yourself differently than your general manager?


DF: There’s so many layers that are interesting. Point of Rental, we came over to them in November of 2019. We had been with another company and we loved them, but they just didn’t have some of the options that we wanted and Point of Rental was able to offer those. There’s different modules along the way. You’re looking at The Pinnacle, where someday I can add this in, and someday I can add that module in and all that. And you can see these increased efficiencies along the way. That’s where you start to add some real fun.


DF: I’m probably a part-time integrator and he’s a part-time integrator. The goal would be to get him out of needed daily functions and allow him to operate as a full-time integrator and allow me to step out completely. But we’re not quite there yet. Dan, I want to be real clear upfront with you, man. The scorecard has been a frustration to me because I have not done well at this. Anybody listening, please don’t listen to what I have to say next


DC: You guys have been looking at metrics. Let’s move over to that metrics, that scorecard. Well, we’re going to touch on anyway, because that’s where the pain is. It does hurt, but it is interesting because in branch management, we’re seeing it around the country with independence. It is becoming more streamlined. In fact, we’re having a round table. It’s a virtual round table strictly for branch management. That’s available in December and January. There’s a quick plug, but anyone can attend even non Peer Group members. We just make sure that there’s only 10 per session. It has to do with, as a peer, as a branch manager, what is my role and responsibility, not just interacting at the store level, but how do I interact with the general management level? What am I responsible for feeding, data upstream or being held accountable for? In your case, you’re looking at you now knowing how deep you’ve gotten on this and your hourly utilization. You’re going to look at your categories of assets at that store and see how things are being utilized. But does that mean that the asset has to be at that home base? It’s not in a central, so how do you deal with that?


DF: That’s exactly the issue. So often I start putting these metrics together and start trying to identify how this works with our model and the way that we’re operating right now, it’s completely unfair. For me to hold somebody accountable to a number that they have almost no authority or control over is unfair. If the customer is close to our location, it is very common for a customer to pick up something at one branch and take it back to a different branch. We can try and turn the screws and get in for somebody to take it back to that home base. But then with the point of rental, when you close out that order at the other branch, that branch receives the revenues. So now I’m left with the choice; either let it set or spend more time in the office, making general ledger entries or making corrections. If I dig in that deep, we could probably make the time for it, but we just haven’t found a way to make the time for that right now. So I have really struggled with measuring utilization saying, “well this thing’s out 120%, it’s got 120% utilization”. It’s being shared from A to B to C to D and that’s an obvious point, but there are other things where it’s extremely low when we’re sharing it back and forth.


DC: I think that’s the challenge, right? You’ve had four operations for a number of years, but you’ve recently changed your management software. It’s like you’re starting fresh and saying, “how do we manage and how do we look at metrics? How much time do we waste on proper reporting versus getting the job done? Getting the assets out of the yard and out on the project sites”? Now in your branches, do you have mechanics in every branch or do you have more of a central? I know you mentioned you had some, where specific assets will be taken to the main location.


DF: So we’ve been kicking around it’s centralized shop ID, and I know a lot of guys have strong feelings one way or the other, or it’s a pipe dream that someday I’d like to get to it. What we’ve done is tried to home base some of the more complicated systems with our higher dollar techs or our more skilled and experienced techs in one location. Therefore, all those orders ship or are received back into that area. We do have mechanics in each branch obviously, but they’re not all tier three, high-end mechanics. Some of the guys are small engineers. Some of them are focused more on small electronics, but you have to have somebody somewhere. Our answer to that was; it’s not a true centralized shop, but it is kind of a centralization to knowledge in one area.


DC: Now do those people, from a coaching perspective or an evaluation perspective, is the branch manager active in that or does the branch manager run counter and some of the general duties on a branch and then leave the development of the staff to the overall general manager or yourself? Where does that go? Is it the branch manager managing all the human resources in their particular site or is it more spread amongst the company?


DF: The branch manager is ultimately responsible for our people, knowing our equipment, knowing our facility. You can break it out into a lot of different buzz words but really we want them to know what’s going on with the customer base such as, who is coming in and out the door and what they’re looking for to make sure we’re satisfying their needs operationally. We’re making sure that they’ve got the right people in the right seat to go back to the U.S. term that can really do the work of the daily functions in there. Also they’re kind of facility managers such as “hey, we’ve got a leak in the roof over here” or  “I need to get this piece of concrete replaced”. That’s really their responsibility. General manager is the guy pulling the heavy lifting on that because he’s responsible for the training calendar, for the OSHA safety requirements, and some of those things. But that’s not his strong suit either. I don’t want him dragged down into that area that much so that’s why we’re looking at transitioning over to a professional employment organization to build out an HR.


DC: A PEO, so essentially that would be an entity that would act as your almost outsource human resource management?


DF: Yeah, there’s some places for that. For us, at that 35 person area, we can’t quite justify a full-time HR department. But we need to be able to have somebody to answer the phone when an employee has a new baby or he breaks his arm, or he wants to change his withholding taxes, etc. So, right now it’s being handled by my office manager, but that’s not really her training.


DC: That’s a good point. I see a number of people look at PEO and they balk due to costs. When you’re in a position where you’re growing your business and you’re looking at adding a staff person, because things have gotten so much bigger and more support, you’re over 30 employees. Comparing that new hire in the HR area versus using an outsource solution or even a PEO where you know, they’re leasing the employees and you’re leasing them from the PEO company. I could see the potential for that. I know a couple people who use PEO and have used them forever. Even though it looks like a big expense on their income statement, it actually is replacing an FTE or a body count so they can justify the cost of that relationship.


DF: Exactly. It really does come down to, if I’m looking at hiring a full-time person, it’s going to cost me this much to add on this service. It’s a net savings for me, let alone the upside of this year. Anybody listening to this didn’t know what to do most of the time with their response to COVID. We didn’t know what to tell guys or how to tell it to them. How were you exposed? How are you supposed to handle this? We were crowdsourcing that through and I’m sure a lot of guys listening to this probably did the same thing we did. We were having weekly calls in our bag meeting or weekly bag where we were trying to share, “hey, this is what I heard, this is what I’m supposed to do”, but to have somebody that does this professionally and is paying attention to that and has a wider range of resources, I can tap into that. That has real value to me, let alone, easing that onboarding or exit. There are so many upsides to it for us, but some guys might like or might not like it.


DC: No, I think it’s great. We have been running into people’s strategy issues big time this fall with all of our peer group meetings. We’ve created the HR scorecard where people are able to say, “okay, on these 20 different levels of managing people, where are we good and where do we still need to build a system”? Then of course, if you’re implementing your EOS, you have the ability to make it a rock and put it in place in your company. There is no question that I can see where people spend a lot of energy, even though we have a lot of unemployment in this country, that the skilled jobs are filled, right? So we can’t. So we need, when we need technicians or people that work in the company, we’re having trouble finding the people who will stick.


DC: I want to briefly touch upon any ideas and or uses around new technologies. I know GPS has become more prevalent. GPS Locator is one of our vendors. We have Ravi tracker sponsoring this particular podcast and making sure that they have GPS on certain systems. As you have your equipment, a bigger and bigger fleet and the fleets out more and more and more, how have you looked at new technologies and anything to you to manage those assets?


DF: The things I’m looking for or looking at are inventory management. Like I said, we share things back and forth. You can think you have something in some place, go to the shelf, and it’s not there only to find out that it’s been returned somewhere else and somehow it’s not there. So that is one of our biggest holdups right now. It’s a real frustration. I’ve looked at either putting a QR code or a barcode on every piece of equipment and then getting tablets in the back for the yard guys and the techs to track. I believe, with Point of Rental or work for a record 360, you can timestamp and geo stamp where certain functions were done. Only problem with that is, this stuff is all being used.


DF: So those sticker barcodes as Q codes might not be legible. It’s not the right answer all the time. So I’ve kicked around the idea of making these RFID tracker bugs because they are obviously on larger things. GPS, that makes a ton of sense on a skid-steer or on an excavator boom lift. The plate compactor, where am I going to put that thing on there and not have it rattled loose? So they make RFID trackers in different forms where you can go as simple as the handheld scanner that would just record it in, or they even make them over your entry and exit gates. So to timestamp it as it goes in and out what you’ve got there. I’m in the early stages looking at that, but I’m looking for an answer.


DC: You are seeing companies pop up like record 360, which is helping people to better serve the customer by better serving yourself, protecting yourself legally, pictures being attached to files, that kind of thing. More and more of those types of uses of technology in the future. It’ll be interesting to see where that ends up. The old question of how do I manage assets amongst multiple locations will always be a topic of discussion. I don’t know that there’s anything very simple about it, but at some point you do need to commit to a vision for yourself. So tell us about your future. How do you see things changing? Hopefully we’re going to come out of the pandemic at some point, but what’s going to happen with general rental is from a system standpoint, from an expansion or a personal standpoint, what do you see in the future for you?


DF: Onward and upward in 2021. I’m just a generally optimistic guy but I feel like 2020 was a blip. It was an odd year from a lot of perspectives. I just take it as a one-off. I could be mistaken, but I don’t think I am. We have been gearing up. I feel for this type of business. The rental industry is so varied. There are so many different niches that you can fit into. So for our particular model and how we operate, there’s room for opportunity in a lot of markets around us, and we feel like we’ve identified a couple that we’d like to move into. Before we do that, we’re really focused on doing what we do now better and really doing it well. Stop shooting ourselves in the foot by forgetting to send out a key or not putting the pin in that auger bit, whatever it may be. Really building the systems around that because we’re talking about technology so often a lot of this stuff is great, but you gotta have the system in place to use it for your people before technology can make anything work. Computers fail, but the process has to be sound. It should operate regardless of any technology that comes along.


DF: So that’s what we’re working on right now. I’ve spent an inordinate amount of time building out of state an SOP manual, a daily procedures manual. It is a constant work in progress but really giving us a training manual that says, “hey, this is how we do this every time”. So if we do inject a new piece of technology in there, it can only make that system easier or more efficient, but it can’t fix the problem. That’s what the process and the procedures are in place for. That’s what we’re working on right now as we continue to hopefully grow. Thanks for having me, Dan. I hope it was useful.


DC: Excellent. Well, Dan Fielitz I know that you are committed to your EOS implementation and my guess is that you will have great employee retention and also be recruiting people because you make those types of commitments to improvement and communication with your employees. And of course, any employee is going to want to work at a company where they know they’ll be heard. So we appreciate what you brought to the table today for us.

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