It was one of those career-defining moments.
Matthew Holowinski had been a top performer for Avis Rent A Car at Chicago’s O’Hare Airport. He had even turned down a manager’s position, realizing he could make more money remaining as a sales agent. He did, however, accept Avis’ offer to become an independent operator in a new location in Skokie, a suburb of Chicago. He built the store into a $1 million earner.
Some 12 years later, he sat thinking something was missing. “It was time to move on,” he says. “At one point you ask yourself, ‘What do you do best in life? What do you like to do?’ I decided the best way for me was to get out of the nest, spread my wings and try to create something from scratch on my own.”
Holowinski opened his own car rental company in 2008 with a lot of determination and one car—an eight-year-old Ford Focus bought for $3,000. The decision to go completely independent as opposed to buying into a franchise system was predominantly financial, as getting a loan for the licensee start-up fees was a stretch for him at the time.
He named the company Greenberg Rent a Car, the translated name of his hometown in Poland. “I wanted to open this company so bad; I said, ‘I know I can do it,’” he says.
Learning the Market
Holowinski originally wanted to open in Chicago, but he had difficulty getting the permits and the business license. That turned into a blessing in disguise. He found a small office in Norridge, two blocks from Chicago’s city limits. Norridge pays 8 percent less tax than its neighbor, a boon Holowinski uses when marketing his services.
Aside from his humble Ford Focus, Holowinski’s idea was to create a luxury car rental company. He bought a Lexus LS 460 and tried to stir up business in places such as Signature Flight Support, a fixed base operator that handles corporate and VIP travel out of O’Hare. He couldn’t crack the market.
He turned in the opposite direction when he began to realize the growing market of credit-challenged renters with a need for basic transportation. Those renters are often declined at the major car rental companies, as cash deposits are subject to a credit check.
Holowinski called his competition directly and told them he’d rent to their declined clients, and even pick them up. “I told them, ‘We want who you don’t want. Give us a call if you have a customer who is stranded,’” Holowinski says. “That’s how I started to grow.”
Holowinski or his employee, a friend from his days at Avis, brings a laptop and a printer when delivering vehicles which allows them to create the contract anywhere. Customers appreciate the attentive service and even come back to Greenberg to rent after their credit problems have been solved.
Though business came, Holowinski knew the cash market was risky. He got burned. He tinkered with controls such as a 30-year-old age minimum and customer screening. He even put GPS tracking devices in all the cars. The problem was not necessarily collecting payment, but damage to the cars.
One change made the difference—Holowinski now only allows cash rentals with a debit card. Those renters usually don’t have a credit card, but they at least have passed their banks’ requirements and can be traced. “The bank is doing all the work for me,” he says.
“When we stopped doing cash rentals, we stopped having problems,” he says.
At this point, the market for debit card customers is greater than he can fulfill. “I’m getting calls from 10 people a day that I have to turn down because I don’t have cars,” says Holowinski, figuring demand is so great he would need three times the fleet size.
What’s standing in the way of growth? “I’ve had a hard time getting financed,” he says.
It’s tough being a startup, especially when banks want to see two years of operation before considering a new client. Forced to get creative, Holowinski grew his fleet through a patchwork of funding sources.
He used a loan from Volkswagen to buy three cars and bought two more on a personal loan. For the Lexus, a dealer put him in touch with Titus Leasing, a company that specializes in the livery industry. Titus agreed to lease him the Lexus. When Holowinski had problems getting a loan from the captive finance companies, he returned to Titus.
He has created a Dun & Bradstreet profile to help him obtain a credit line with traditional car rental funding sources.