Even if you’ve already squeezed every penny from parts, service and sales, there’s still another profit center you can add to your dealership: rentals. In both good times and bad, dealers across the country have counted on their rental departments to maintain cash flow, create used inventory, promote their stores and provide a service their competitors don’t (or won’t) offer. Even if you’ve already tried it, now may be the perfect time to reconsider renting.

“What dealers who are in the rental business will tell you is that you get a lot of cash flow out of rental,” says Bert Alanko, chairman of the RV Rental Association (RVRA) and president of MBA Insurance, an RV rental insurance agency. “You get a lot of big cash; when you’ve got a rental vehicle, people are giving you $1,000 or more a week. If you’ve got 10 vehicles in your fleet, you’re looking at $10,000. That’s a lot of cash flow.”

Yet that’s just part of the story, he says, as rentals provide a variety of benefits to dealers that other departments such as parts and service simply can’t give them.

“Some of those renters will turn out to be buyers. It isn’t going to happen all the time, but it only has to happen once or twice,” Alanko says. “It’s also a matter of promoting your business; everybody wants to promote their businesses. Rentals give you one more place to advertise in the Yellow Pages, one more thing to advertise on your Web site, one more reason for people to come by your dealership to do business with you.”

Alanko speaks from years of experience in the field. His Arizona-based agency has offered rental insurance for everything from scooters to motorhomes since 1978. He even created the MBA Rental School, an annual multi-day seminar – now in its ninth year – that’s offered to spread the gospel of rental operations.

“Dealers who are not in the rental business will say to me, ‘I must get 20, 30 calls a week about rentals,’ and they’re replying, ‘You want to bring me $1,000? No, no, I don’t want that money. I want you to go down the street to the dealer who rents and I want you to give him that money,’” he says.

An Addition Profit Center
For three established dealers, Altmans Winnebago in California, Krenek RV Super Center in Michigan, and M.B. Thomas Winnebago in Missouri, money isn’t sent down the street, as each has offered rentals for at least 20 years. Indeed, Joe Altman and Scott Krenek have been part of the rental school faculty since its inception; both men, along with M.B. Thomas owner Lonnie Hall, say the rental business is vital to their dealerships.