It's been a busy year and a half for Chicago-based Greenberg Rent A Car since Auto Rental News first profiled the independent rental company ("Finding Your Niche," Sep/Oct 09). Since then Greenberg has evolved from the ground up, changing from a business that worked with high-risk, cash rental clientele to one that now services corporate customers and credit card holders from its new counter at the Radisson Hotel Chicago O'Hare.
How has founder and owner Matthew Holowinski achieved this business success, even as the travel industry exits the recession?
A New Breed of Customer
Holowinski got his start by offering to take competing car rental companies' cash-only castoffs.
"I built a ground for my business on those higher risk customers," says Holowinski, who developed his career as a top salesperson at Avis O'Hare and then as an Avis independent operator. "I paid the price for that too, but that was the cost of starting the business."
"A lot of cars were coming back with slight damage or damage," he says. "It was really hard to collect from those people. We learned from our mistakes and it changed our direction completely."
"When I was doing just the referrals, I was basically on life support from my competition," Holowinski says. "I knew that sooner or later, something might happen and I wasn't going to have business from them or they're going to change the rules and I'm not going to have any business."
Holowinski knew he needed to upgrade his customer base.
A Strategic Location
An essential first step was a higher-profile location. The company moved from its original rental location in Norridge to the Radisson Hotel Chicago O'Hare, less than a mile from the airport. Holowinski keeps the Norridge location as a main office.
Both locations are just outside of Chicago's city limits, saving the company around 18 percent in taxes without losing the convenience of proximity to the airport.
He pays a reasonable flat rate to the hotel. "The hotel knows we're a new business and that they can't ask for a lot of money from us right away," Holowinski says. "It's convenient for them to offer a rental car company to their customers."
Holowinski realizes the hotel took a chance on an independent. He returns the favor by projecting a "big-business" look with a professionally-designed lobby counter and a trained counter employee who wears a uniform and a nametag.
Greenberg-the translated name of Holowinski's hometown in Poland-also runs a minivan shuttle with the company logo. "Everything looks very professional," Holowinski says. "People think that this is a big company."[PAGEBREAK]
The Affiliate Strategy
The next step was to gain the right reservations. Holowinski partnered with a new affiliate program offered by Economy Rent a Car, based in Costa Rica and expanding in airport locations in North and Central America.
The key for Greenberg was Economy's listing on Expedia and Orbitz at O'Hare International Airport, which is finally driving the right kind of customer to Greenberg. "Our priority right now is the customer from O'Hare. We're trying to keep the airport customers happy," he says.
The affiliate program allows Greenberg to keep its local identity, and, so far, Holowinski is happy to trade the hefty affiliate commission for more reservations. "This is the only way I see that I can grow," he says.
Holowinski now has the luxury to avoid the cash-only crowd, and he'll only take local customers with debit cards if they have full coverage insurance.
However, he will still take airport referrals for customers with debit cards, many of whom are soldiers coming back from overseas with inactive credit. "They're getting paid through their debit cards directly through their checking account and are having problems trying to rent a car," Holowinski says.
Not long ago, most of Greenberg's clients were walkups on weekly rentals or longer. With only 20 or so units, this precluded the need for a reservations system.
Today, the company uses Rent Centric to create and manage reservations. Holowinski uses RezCentral from TSD, through his Economy affiliation, to control and update rental rates three to four times a day. "The Expedia and Orbitz customers are focused on the price. So they want to have the best deal and I'm getting those reservations when my price is low and I'm first on those ratings."
Greenberg's financing situation has improved. However, Holowinski has stuck with his original funder, Titus Leasing, a small, independent lessor specializing in the livery industry. "I tried two different sources; they didn't work too well," he says. "Those are smaller leasing companies. I couldn't accept their conditions."
To service the airport's peak season and to expand, he knows he will need an additional funding source. At the moment, Greenberg has 30 vehicles but Holowinski is in the process of buying at least another 10 units. The goal is to reach 60 to 70 units within a few months.
Holowinski has a dependable broker who buys rental cars from the majors at auction. He purchases mostly six-month-old 2010 or 2011 model-year units. He's had good success with Kia and Hyundai. "To us, those cars are very dependable," he says. "Some of the units have over 100,000 miles and are still running strong."
The newer vehicles are usually given to airport customers and referrals from the competition at O'Hare. The local, higher risk customers are given the slightly older units.
Vehicles are also equipped with GPS tracking devices. Though outright theft has been mitigated with the higher-class clientele, Holowinski has used the system to locate a car left at the airport by hurried renters or to help a renter with directions if they call to say that they're lost.
A Bright Future
With the airport customer as the main focus, it's no surprise that Greenberg's next target is Midway Airport. Holowinski is looking for a location outside the city limits to catch another break on taxes.
"Five years from now, I see myself in both locations, Midway and O'Hare," he adds. "I see myself expanding to Milwaukee."
Holowinski admits that he finds passion in his work. He compares his business efforts to sitting in the pilot's seat of a heavy jumbo jet: difficult to take off the ground but worth the effort once you're up in the air.
"When you beat those obstacles and you're able to take off, you will hit the higher altitude," he says.[PAGEBREAK]
SIDEBAR: Selling Service
As owner and operator of Greenberg Rent A Car-an independent car rental company-Matthew Holowinski understands that without brand recognition, customers have no idea what type of customer service they'll receive. Therefore, he bends over backward to provide the best possible rental experience to build his reputation.
"Yesterday, I picked up a customer from O'Hare. He was almost scared to rent from an unknown company, but after he experienced the service, he even shook my hand. It's amazing," Holowinski says.
Kristy Fischer, a Greenberg client from Orange County, Calif., found herself out of luck with the major car rental companies when she landed at O'Hare Airport with only a debit card in hand.
After a call to Greenberg, Fischer was picked up within 15 minutes by a driver while Holowinski sat in the back seat filling out the paperwork on the way back to the office.
"They even upgraded me into an even nicer vehicle," Fischer says. "It just seems like everybody makes it more difficult to do business these days and these guys made it really easy for me."
Holowinski understands that good customer service means sometimes relaxing the rules. The company usually does not accept prepaid debit cards, but one customer's dilemma convinced him otherwise.
Prince Woodberry, a pastor from Virginia, was trying to get to Chicago to help a woman and her three children involved in a domestic violence situation. After being declined at all of the other rental agencies, Woodberry turned to Greenberg with his prepaid card and was disappointed to hear the cost would be upwards of $250 just to cover the extra mileage.
After overhearing Woodberry talking to his wife about the story, Holowinski offered to waive the mileage fees and charge a flat rate so the pastor could get to the family in time.
"He really came through for me," Woodberry says. "I could not have done it without him."
One of Greenberg's loyal customers, Andy's Frozen Custard owner Andy Kuntz, was referred after he had been informed that his former go-to car rental company was sold out. After being picked up by Holowinski and experiencing the personable customer service the first time, Kuntz says he hasn't been back to the other company ever since.
"You've got a guy that owns a company that cares about his relationship with the customer," Kuntz says. "It's just a very convenient, one-on-one relationship experience."