Car Rental Q&A: How Can Independents Compete With the Majors?

Q: I'm an independent car rental company and it's always a struggle to compete with the majors. Do you have any strategies?

— Elia Sikanen, Ambassador Rent A Car, Lake Worth, Fla.

A: As an independent car rental company, it is difficult to compete with the majors. The majors will always have more buying power and a bigger presence, but here are 14 tips to help build your presence in your local market:

1. Create a recognizable brand name. Consider a franchise or an affiliate program so you can afford to be on as many search engines as possible. Renters may feel uncomfortable renting from a company they have never heard of.

2. Increase your online presence. As a small independent, it’s not feasible to be listed on the major travel search engines such as Expedia and Orbitz. However, look into portals like Car Rental Express (carrentalexpress.com) that cater to smaller companies.

Also, understanding SEO (search engine optimization) best practices in your local market can help your company gain a listing on the front page of search engines like Google and Yahoo.

3. Don’t underprice your product too far below your competition. Hold fast to higher prices until bookings pick up — or until the majors’ reservations are growing and they move up their pricing, too.

4. Never underestimate the power of excellent customer service. Renters may initially choose you because you had the best price, but they will choose you the next time because they were treated so royally.

If you have renters that you want to impress, make sure they remember you. Give them a bottle of water for their trip or a small snack bag with something representing your location, such as an apple for New York or cheese from Wisconsin. A small gesture can turn a one-time client into a longtime one.

5. Know what your competition is renting and offering. Instead of complaining about the competition, emulate them. Do they have separate lines for repeat renters or members-only clients? If so, you should consider doing the same.

6. Understand the value of uniformed employees with name badges. This professional touch helps instill confidence in the renter that this is a well-run rental agency.

7. Keep a clean and orderly counter at all times. Being clean and organized helps your business look more professional. Your shuttle bus is also a reflection of your business so it’s important to keep it clean.

8. Encourage your employees to be take-charge people. Allow them to settle disputes under $50 and don’t question them after decisions have been made.

9. Work at the counter occasionally. If you as the owner/operator do not usually rent the cars, make a point to do it as often as you can to see if your quality and your personality are capable of bringing return business. Your employees will appreciate your participation, and your customers will feel important since the owner took time to meet and greet them.

10. Find replacement vehicles with your competition. If you run out of cars (and you should run out at least two days a week if your utilization is high enough to produce a profit), make sure you find a replacement vehicle with your competition.

If there is a price differential, send the renter a check with your company logo and contact information. That way, renters have visible proof of your commitment to their return business.

11. A niche market can be profitable. Passenger vans, handicap vans, luxury cars, camping vans or recreational vehicles (with camping rental equipment) can be in demand in certain niche markets, but you can still compete with a varied fleet.

12. Cultivate local small businesses. Small businesses like to use local car rental companies for statewide business trips. If they need the vehicles delivered and picked up, ensure that your company can accommodate that need.

13. Attend industry meetings. By interacting with your competitors, the more you can learn about what they do and how you can compete better.

14. Don’t underestimate your worth. As a smaller company, you can still compete and secure a market share that is desirable and profitable. And if you grow big enough, a major might deem you worth buying.

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