The party rental segment is a true touchstone for the health of the special event industry. Who knows better what really happened on site, and when — and if — the bills were paid? So it's a good sign that our party rental pros are feeling positive about business in 2003, with fully 70 percent expecting more event business than last year (see our cover story, beginning on page 34).
But in today's uncertain business climate, the party rental operators we interviewed aren't waiting for the event planner to come calling. They are grappling with the challenging environment by adjusting operations and focusing on core strengths.
For example, cost pressures are beginning to affect pricing. Even though client budgets are tight, some 28 percent of respondents to our party rental survey are raising prices. However, their price increases are highly strategic.
“We are raising book prices — this is critical,” one operator tells us. “But at the same time, we are packaging discount promotional offers targeted at specific customer profiles. This effort is aimed to counter low-price competition and force them to compete on thinner margins. This will limit their reinvestment rates and create a wider differentiation in product quality.”
And product quality remains a critical point of differentiation: “Our commitment is to carry the items you can't find anywhere else,” as one operator puts it. Indeed, 80 percent of respondents to our survey said a major sales-building strategy in 2003 will be to add new inventory.
But great inventory doesn't sell itself — much less drive itself to the venue. As a result, many operators tell us they are focusing on service in 2003.
“Service is always a key to success in this business,” says one party rental company. “We have no ‘silver bullet,’ but continue to improve things like better communication on deliveries and pickups, and faster and more cheerful response to last-minute requests.”
“Anyone can rent tables and chairs; we can do that and so much more,” says another. “We understand the responsibility we carry to help people with very important events in their lives, both business and personal.”
With service the watchword, many operators are making another investment this year: training staff in customer service.
“In spite of the need to reduce staff, we have just reassigned one of our most tenured staff members to employee training and development three days a week,” one operator says. “There is also significant added cost reflected in the time staff will spend training under this individual. But we need to be ready for an upturn in the economy, and as business stands today, it comes in waves.”
Here's to waves of business coming your way.