Creating capacity through RENTALS
Markets have become more competitive than ever before. In turn, this has forced many companies to become leaner and shift their strategy towards innovation.
Mpact Plastic Containers has realized the challenges faced by many
companies through customer engagement and market analysis.
The answer became apparent:
1. Customers want to own their core manufacturing process or service offering to the market.
2. All non-core items could be insourced in different ways and only when needed.
This need was interpreted in the form of the rental offering of products to customers, thus freeing up capital that could be employed in their core business such as machinery or service provision.
Mpact started a Rental division for fixed rental terms to various market sectors. The first sector was the municipal market. Municipalities see Wheelie Bins as a non-core item but the provision of waste collection, transportation, disposal and treatment as core service items.
One municipality has taken up an offer for all Wheelie Bins needed through a rental system. Since this is funded from the operating income, it gives the municipality the ability to invest in key service delivery areas such as treatment and disposal sites.
Likewise, retailers are also not looking at owning pallets and crates in the future due to capital constraints. This will allow retailers to rather invest in income-generating projects such as new stores and other key areas.
The Rental Division and its offering is new to the market, but through positive customer and market engagement, it is gaining traction as customers identify the benefits.
Credit: Lance Kallis