Selling an independent equipment rental company is one of the biggest moves an owner will ever make, and the process gets a lot easier once you know what to expect. Gary Stansberry has spent more than two decades helping rental owners sell.
He started as a CPA at Deloitte, ran his own rental company in Dallas, worked on the buy side for RSC Equipment Rental and NationsRent, and in 2000 he switched sides to represent sellers. Since then he has closed more than 140 transactions worth over two billion dollars.
In this episode of The Rental Roundtable, Gary walked through how the M&A process actually works and explained why independent operators need to step up their game to survive the next five years.
Why M&A Is Not As Glamorous As It Looks
From the outside, selling a rental company looks like a quick handshake and a wire transfer. Gary says the reality is very different.
“It is like the old thing about sausage getting made. You really don’t want to see what happens behind the scenes. There might be 10 percent sexy and 90 percent not sexy to put an M&A deal together.”
Gary Stansberry, [1:31]
That 90 percent is legal documents, financial statements, and due diligence. It is also why selling a business is rarely a phone call followed by a market launch the next week. More often it is a two to five year relationship where Gary works with the owner to clean up the operation and get the company ready for the right buyers at the right price.
The Sweet Spot for Independent Rental Company Sales
Gary works with small to mid-sized independents. His typical client does between 5 million and 25 million in revenue, with 2 to 10 million in EBITDA and 10 to 60 million in fleet assets. About 80 percent of his transactions land in that range. Most of those sellers are owners in their 50s, 60s, or 70s who started the business in the 80s or 90s. The company is their single largest investment, and they want someone who has been on both sides of the table and is not getting paid by the buyer too.
Why Dual Representation Is a Red Flag
Gary represents sellers exclusively. He had seen brokers take money from both sides of a deal, and he did not think it was fair to either party.
“You got to put on the jersey of one team or the other. You can’t be paid from both sides.”
Gary Stansberry, [13:36]
If you are talking to an advisor and they are getting paid by the buyer too, ask questions. The person sitting across from you should be working for your team.
What Separates Great Rental Companies From Average Ones
Gary has walked into hundreds of rental companies. He says the difference between a great operation and an average one shows up before you ever look at the financials. It shows up in the leader, the culture, and the way the team treats customers.
Leadership Sets the Tone
The best rental companies all had a leader who set high expectations, modeled the behavior they wanted, and built a culture the team bought into.
“Your people will do what you do. If you care, you’re involved, you have that culture, then that goes to your people.”
Gary Stansberry, [26:59]
Gary remembers a mentor putting it the opposite way. The fish stinks from the head. If you walk into a rental yard and the trucks are disorganized and the shop is a mess, you can usually walk into the owner’s office and find the same thing. A clean office and a sharp owner usually means a sharp operation.
Say Yes to the Customer and Show Up for the Community
The best operators also share a customer-first mindset. Their teams find a way to say yes within reason. Their customers feel taken care of. And that shows up in repeat business and the kind of reputation that takes decades to build.
Gary says the same operators are deeply involved in their communities. Not chamber of commerce photo-ops. The rodeo sponsor. The high school sports backer. The owner who shows up at the local stock show because their kids and their customers’ kids are competing. That presence builds trust no marketing campaign can buy.
Can Independent Rental Centers Survive the Next Five Years?
In 2024, Gary wrote an article titled “Can Independent Rental Centers Survive?” The short answer is yes. The honest answer is that most of them need to step up their game.
For years the industry was forgiving. Gary’s dad used to say it was hard to screw up a bowling ball. Then 2008 hit and a lot of operators got exposed. They had too much equipment, too many employees, and no way to see what was coming.
Today the bar is higher. The second-generation owner with three locations and a few million in fleet assets is competing with United, Sunbelt, and Herc. The nationals have corporate staffs and sophisticated data systems. The independent still tracking inventory on a whiteboard and writing contracts by hand is going to feel that gap.
From Artificial Intelligence to Actionable Intelligence
Gary heard a lot of AI talk at the rental show this year. He likes what modern tools can do, but he wants to reframe it.
“I would like to change AI from artificial intelligence to actionable intelligence.”
Gary Stansberry, [34:39]
Data alone is not the answer. A rental company with 2,000 line items, 100 tickets a day, and several locations generates a Niagara Falls of information. If you try to drink from that firehose, you will drown. The point of modern software is to take that flood and turn it into a targeted stream. Show the owner the four or five metrics that matter. Flag the outliers. Tell them what to do about it.
Start With the Metrics That Matter
Gary’s mentor Green Smith, the owner of We Rent It in central Texas, watched fleet on rent every single day. That was his anchor metric. Gary tells his clients to start with the basics. Revenue. Payroll, which is almost always the largest cash expense. Rental fleet utilization. EBITDA. Get comfortable with those, then add more.
He also warns owners to be careful how they bucket revenue. He has seen owners excited about a hundred-thousand-dollar month only to realize most of it came from a single machine sale. Separate equipment sales from rental income or you will be making decisions based on the wrong number.
For a deeper dive into the financial red flags that kill deals and hurt valuations, Rental Roundtable #48 on the top 5 financial red flags in rentals is essential reading for any owner thinking about their exit. The episode on navigating financial clarity with Matt Lescault is also a strong resource for getting your books in shape.
The Specialty Rental Opportunity for Independents
Specialty rental has become the industry buzzword. United and Sunbelt now report that 30 to 40 percent of their revenue comes from specialty. But Gary says specialty does not have to mean trench shoring or pump and power. It can mean focus.
“Maybe your specialty is your geography. Maybe it is the type of customer base or the target market that you have. Maybe your specialty is not necessarily a product line. It is what you do and who you interact with.”
Gary Stansberry, [40:54]
Gary points to Brett Baker at States Rentals as an example. Brett picked a specific type of customer, spec’d his machines for that customer’s exact work, and built his business around being the best at serving that niche. That is something an independent can do today by getting clearer about who they serve and how.
What This Means for Owners Thinking About an Exit
If you are an owner in your 50s or 60s thinking about what is next, the path is straightforward. You do not have to sell tomorrow. But you should be running your business today the way a buyer would want to see it run two or five years from now. That means clean financials, real metrics tracked regularly, a team that can run the business when you are not in the office, fleet decisions backed by data, and modern systems that show your operation clearly across every location.
Gary’s success rate is around 80 percent, and it is that high because he does a lot of upfront work with sellers before going to market. The owners who do best get honest about where they are, fix what needs fixing, and give themselves the runway to do it right.
Recommended Resource: How to Value a Rental Business: Valuation Tools & Methods
The Bottom Line
Independent rental companies can absolutely survive the next five years. But survival is not the goal. The goal is to build something that competes, grows, and is worth more when you hand it off than it is today. That takes leadership at the top, a culture that says yes to the customer, real community involvement, and the willingness to embrace modern technology instead of waiting for the legacy system to catch up.
The operators pulling ahead right now are the ones who stopped tolerating the friction. You can watch the full conversation with Gary Stansberry here, whether selling is on your horizon next year or ten years from now.
For related listening on what it takes to build and sell a great rental business, explore these Rental Roundtable episodes:
The Numbers Don’t Lie: What’s Broken in Rental Growth
How PCR Was Built and Sold to Herc Rentals in Under 5 Years
How to Sell Your Rental Business
