How Moving Stuff Helped a Business Keep its Edge in the Mobile World

When the late George Carlin used to say that finding a place for your stuff is the meaning of life, he probably didn’t have computer and audiovisual rentals in mind. Yet, to hear Mike McClernon tell it, Carlin’s bit of wit and wisdom could be the basis of his firm’s business model.

“I like to say that we’re a ‘stuff company’ because people understand that. We have deliberately stayed out of the software services side of things or the thought or content side of things and stayed in the stuff business,” says McClernon, CEO and president of SmartSource Computer & Audio Visual Rentals — a privately held middle-market firm that currently manages its “stuff” from 23 locations across the United States, while employing 250 people (including more than 100 field technicians).

“There are various ways to measure the different players in the rental business these days, but we consider ourselves the largest company dealing with end users,” says McClernon, who further qualifies SmartSource as having more “customer-facing relationships” when compared to competitors that supply wholesale rental services as part of an integrated supply chain.

According to McClernon, SmartSource operates in both worlds by efficiently supplying what its customers demand, which does not necessarily translate into the rental of cutting-edge technologies.

“We’re not really a digital company. We’re not really concerned with the Digital Age,” explains McClernon, who says that when it comes to technology, SmartSource has a keen focus on the logistics behind hardware replacement for short- or medium-term technology rentals.

Still, as more of SmartSource’s corporate clients have become “tech’d up,” as McClernon puts it, and more mobile devices allow users to move their own “stuff” with greater ease, it would seem that the Digital Age has been dealing SmartSource a raw hand.

Or maybe not. SmartSource appears to have read the technology tea leaves well, beginning with a name change in 2007 (from Rent-a-PC), the same year the Kirtland Capital Partners, a private equity firm located in Cleveland, OH, acquired a majority interest in the firm. Going forward, the breadth of depth of SmartSource’s offerings would be forever altered by audio and visual technologies.

First established in 1984 by entrepreneur Julian Sandler, the firm grew a national footprint over the years by using both organic growth as well as acquisitions. To date, the firm has completed 20 acquisitions, the latest, announced last month, being that of CRE — Computer Rentals & AV Solutions of Culver City, CA. McClernon joined the firm as a vice president in 2003, after the firm then known as Rent-a-PC acquired a New Jersey company where he held the position of president.

“Most of the general technology rental outfits that dealt just in computer rentals have gone away. We bought a bunch of them, and a lot of them just did not emerge healthily out of the last recession,” says McClernon, who would be named president of SmartSource upon the death of Sandler, who passed away 3 years ago.

Empowered by its expanding inventory of audio and video rentals, McClernon says that the firm has made the events business — where it provides rentals to trade shows and corporate conferences — close to 80 percent of its business, compared to its general rental business, which now accounts for the remaining 20 percent.

“There is at least a billion dollars’ worth of technology rentals done in trade shows and professional conferences every year,” explains McClernon, who says that SmartSource finds itself increasingly competing against varied ranks of competitors.

“Whereas inside the general technology rental market our toughest competitors are often smaller players offering limited services but very competitive prices, inside the trade show arena, we face competitors like Freeman AV, which does hundreds of millions of rentals annually,” says McClernon.

Part of the firm’s approach has involved the development of “multiple narrow visions” for each of its distinct customer sets.

McClernon adds: “The messaging, the brand description, and the value proposition all became clear to us when we narrowed our vision to specific markets. The messaging has to change and evolve, and this is something we work very hard on.”