Combining Innovation and Software to Make Construction Equipment Management Simple and More Productive
Noble Iron is a technology-driven company that offers on-demand construction equipment for rent and for sale, and software applications to equipment owners and users to manage their equipment’s lifecycle.
In addition to providing innovative software, Noble Iron takes a unique approach to equipment rentals that involves sharing assets with partner firms and other equipment owners, such as general contractors and construction companies. All of which is putting it on a steady path for growth, say company officials.
Noble Iron’s equipment inventory includes earth moving gear, forklifts and attachments, scissor lifts, vehicles and propane, telehandlers, boom lifts, backhoes and attachments, air compressors and tools, generators and lighting, and mini-excavators.
The company’s main equipment customers are “construction professionals—not just construction firms, but also contractors and individuals who may be in need of construction equipment,” says KJ Park, VP of Growth and Strategy. “It’s a broad range.”
Equipment sales and rentals are based in the same locale in the Los Angeles area. The technology branch, Texada Software, a wholly-owned subsidiary, is based in Guelph, Ontario. The company has a software office in Australia, a corporate office in San Francisco, and an equipment sales/rental operation in Houston that was recently sold.
Needless to say, Noble Iron is quite a decentralized outfit. “All of our management is really dispersed. We don’t have a headquarters per se. It’s all based on the locations and the types of products or services offered,” explains Park.
While Texada Software has been around since the early 1980s, Noble Iron itself is a new company, founded in 2011. Texada joined Noble Iron the year it launched.
At present, the company’s largest segment from a revenue standpoint is equipment rentals. Noble Iron officials, however, want to boost all parts of the company.
“We’re looking to expand all of it. So, equipment sales and rentals and software are geared to grow,” says Alex Kress, General Manager of Software Operations at Texada.
Noble Iron’s overall revenues for 2015 came to $26.9 million. Roughly $22.2 million of this is from equipment sales/rentals and $4.68 million from software. This total represented a twenty-seven percent jump in revenue from 2014.
The increase in revenue can be attributed to several factors, including a broadened revenue stream and branch consolidation on the equipment sales/rental side. The company had five locations in Southern California which it combined into a single fulfillment center as part of a strategic move to centralize operations.
According to a press release from November 29, 2016, the company earned $18.9 million in the first nine months of 2016, versus $19.5 million during the same period in 2015. The release also cites a huge business development that happened last year. On November 9, 2016, it announced it sold its Houston equipment sales and rental operation for $8.3 million.
The Houston division “was significantly smaller than Southern California. At the same time, there was a really depressed economy due to the state of the oil industry. As a result of all those things, we decided to focus on rental operations and our platform here in California,” explains Park.
Members of the company’s team are based in Houston, but the company no longer operates equipment rental and sales there. Noble Iron does not rule out reviving Texas equipment operations in the future.
As for broadened revenue streams, the company has been entering into asset sharing partnerships with various companies. In June 2016, Noble Iron announced an asset sharing agreement with Volvo Construction Equipment. Under the agreement, some assets owned by Volvo will be listed in Noble Iron’s rental pool of construction equipment. In exchange for letting Noble Iron rent out its gear, Volvo will get a share of revenues generated by such rentals.
Asset sharing partnerships give Noble Iron “the ability to [offer] equipment that we don’t have by leveraging our network of suppliers. Asset sharing [involves] equipment that owners have idle in their yard. We can put that equipment into our rental inventory and monetize it for them. This is a unique aspect of our business,” says Park.
“Through our sourcing network, we have the ability to get just about anything. We can distinguish between what we have in inventory and then what’s available through the asset share network,” adds Isaac Ristich, Director of Innovation and Technology.
Thanks in part to asset sharing and the increased popularity of renting, the company’s rental volume has increased. “We talk about the ‘sharing economy.’ It’s happening here in the rental industry,” notes Park.
The company currently has 120 employees across all areas of the company. About twenty-eight of them work on the software side with the remainder on the equipment segment. Last year at this time, the firm had around 130 employees, a reflection of the Texas operation which has now been sold. That said, officials say the company is growing, and they expect to grow the team shortly.
Earlier this year, Noble Iron inked a dealership partnership with Haulotte Group to represent Haulotte’s construction equipment products in Southern California. Haloutte manufactures aerial equipment including scissor lifts and booms. Other manufacturers Noble Iron carries, either in its own inventory or through asset sharing partnerships include Caterpillar, Toyota, Case, Volvo, Genie, JLG, Hyundai, Bobcat, and John Deere.
Most of the time, Noble Iron will deliver equipment to a customer. The company also offers financing options and rent-to-own plans on some equipment.
For its part, Texada Software focuses on cloud and client-based applications for managing equipment life-cycles. Texada’s software applications can be used to detail sale and rental transactions, inventory, maintenance, accounting data, work orders, service, equipment use, equipment depreciation, and equipment disposal. Popular software products include FleetLogic, InSight, GateWay, and SRM (Systematic Rental Management), and Texada provides consultation and support services to help clients optimize applications.
Texada Software’s customers consist of “anybody that rents equipment – from small tools to heavy equipment. We do have some offshoots like medical rentals, audio visual rentals, and event rentals,” says Kress.
Texada’s FleetLogic app is presently deployed to several customers across the globe and is growing in popularity. FleetLogic can be used on mobile devices or desktop computers to manage inspections and work orders, provide more efficient logistics management, and check equipment availability.
“FleetLogic is the new mobile application we’ve released. It’s designed and created for on-site service technicians – people that aren’t working within four walls. They’re on the road. They’re servicing equipment. Our existing client base is rapidly adopting [FleetLogic] and planning on using it extensively. We’ve had great feedback on it and will continue to grow, change and build enhancements into the product for those clients who use it,” says Kress.
“Our focus is definitely on FleetLogic this year. That’s going to be the big one for us for 2017. That being said, we’re always researching and experimenting with emerging technologies, particularly those that have practical applications in the construction industry and can add value,” adds Ristich.
Noble Iron uses websites and social media such as Facebook, Twitter, and LinkedIn to promote its equipment and software segments. Company officials also forge “strategic partnerships” with dealer networks whose marketing efforts benefit the company’s equipment rental/sales segment, adds Park. Texada Software, meanwhile, has a presence at industry shows and runs advertisements in equipment and rental trade publications.
While Noble Iron is structured in a decentralized fashion, its workforce is highly integrated, through technology. “We’re a pretty flat organization. We have our equipment operations in Southern California and software in Guelph, but there’s a constant stream of communication between the two and with others in San Francisco and Australia,” says Park.
“That’s really how the company culture is defined as well. Although we’re geographically separated, everyone is involved with each other, talking to each other. We’re using Skype and Google Hangouts to get people face-to-face,” adds Kress.
Asked what Texada looks for in a new employee, Kress says, “in the software industry, everybody has got skills and people can hone these skills as they come into the organization. What it comes down to is fit. We’re a close little group of people. Some of our employees have been here twenty-seven years. We don’t necessarily hire people from the industry. One of our support reps was a teacher. They bring in different skill sets. We look for people outside the industry norm.”
Park echoes this view. “We think differently about the whole industry. We have asset sharing, which is something that the industry has not necessarily understood or embraced in the past. Because of that, we need people who can think outside of what traditional industry standards have been,” he says.
“Our primary objective is to grow our marketplace. Doing that involves the integration of software. Things such as asset-share, where other suppliers of equipment trust that we market and rent their equipment, require a lot of data tracking. So ultimately, [we envision the] integration of software and rental and sales in very optimized logistics service locations throughout the U.S.,” says Park. These locations might include “New York, Chicago, Atlanta. That’s in the plan.”