RTOHQ: The Magazine March-April 2011

Complete issue of RTOHQ: The Magazine by APRO 

Big Show in Little Rock: Your Invitation to Attend APRO's 2011 Rent-to-Own Convention and Trade Show by Shelley Martinek and Neil Ferguson

Family Matters, Part II by Kristen Card

As the Rental World Turns, Part II: More Lessons Learned From Some Thought-Provoking Circumstances by Ed Winn III

A rent-to-own Family Reunion
Big Show in Little Rock

APRO's 2011 Rent-To-Own Convention and Trade Show

July 11–14 at the Peabody Hotel and Statehouse Convention Center

Call it APRO's Big Show in Little Rock. Call it our Rent-to-Own Family Reunion. Call it a golden opportunity to enhance your business with cutting-edge marketing strategies. Call it what you will — but make it your must-attend event this year. We've added several innovative features for 2011: a custom-made rent-to-own marketing plan you won't find anywhere else, a tantalizing mix of social events in one of America's most vibrant and attractive cities and a keynote address that will unveil "practically radical" approaches to how you should be doing business. And, of course, we'll offer all the trademarks that make an APRO Convention and Trade Show your favorite show each year, including our golf classic at the world-class Chenal golf course; the APRO Trade Show, with specials available only to those who attend; thought-provoking seminars that will inspire and help improve your business; not to mention the year's best opportunity to visit with your favorite colleagues and meet some new friends, too. We're calling it our Rent-to-Own Family Reunion — and you're part of our RTO family, so we look forward to seeing you in Little Rock!

New for 2011: Innovation in RTO Marketing. Marketing is the most requested education topic from past APRO Convention attendees. This year, we'll present Innovation Sessions, a new format examining marketing based on current research into the minds of potential rent-to-own customers. These sessions will equip you with a customized marketing plan created to help increase your business. APRO's education program assembles top speakers and rent-to-own experts from across the country to provide the information you need to succeed.

APRO's 2011 Rent-to-Own Trade Show. More than 100 exhibiting companies will display the latest products and services specifically for the rental industry and they'll offer specials available only during the APRO Trade Show. The money you will save on these show specials will more than pay for your registration fees — and you can win cash back from your purchases. Place orders at APRO's Trade Show to be entered into a drawing for cash prizes totalling $5,000! Also enjoy great food and drinks in the exhibit hall with our complimentary lunch and cocktail party on opening day, as well as a fabulous brunch on the closing day.

New for 2011: Golf Classic at Chenal. For the first time, APRO is offsetting the green fees at a world-class course so that you can play for a fraction of the current rate! Free pre-tournament golf clinic included.

New for 2011: Keynote address by Bill Taylor, a top business speaker and founding editor of Fast Company magazine. In addition to industry updates, APRO's General Session will present a keynote address from one of the nation's top business speakers. Taylor's insights will reset and refocus your vision for your business.

New for 2011: APRO Gala at the Clinton Presidential Center. Social events with great food and entertainment are always a highlight of the APRO Convention and they offer unequaled networking opportunities. Enjoy delicious food and great company at the APRO President's Welcome Reception, Gala Cocktail Party at the new Clinton Presidential Center and APRO's Awards Reception and Banquet, where we'll honor the industry's finest and provide ivory-tickling entertainment by the next best thing to Elton John.

Rental Advertising Excellence Awards. With an emphasis on honing rent-to-own marketing skills at this year's show, consider entering APRO's prestigious Rental Advertising Excellence Awards competition, which recognizes the creative advertising efforts of our industry. The winning entries will be on display in the exhibit hall.

RTO Customer of the Year and Employee of the Year Awards. Past recipients have brought tears to our eyes and pride to our hearts. Be sure to enter your best customer and employee in this annual contest, which recognizes the lifeblood of our industry. Winners will be announced during APRO's 2011 General Session. For details, visit www.rtohq.org.

APRO 2011 Social Events

Joe Eason/Tom Kitchens Golf Classic
9 a.m., Monday, July 11,
Chenal Country Club Golf Course
Sponsored by Whirlpool

Here's your chance to play on a pristine course for a fraction of the normal green fees; APRO is offsetting the cost of one of Arkansas' most elegant and prestigious courses. Chenal Country Club (www.chenal.com/life/country-club. asp) offers two world-class courses designed by Robert Trent Jones Jr., one of the world's leading golf course designers.

Trophies will be awarded to the top five teams, so start practicing your swing! And if you want some pointers, a free golf clinic will be offered from 8 to 9 a.m. on the day of the classic with professional golfer Gene Bone, currently with Affiliated Construction Specialists/ProGuard.

Joe Eason/Tom Kitchens Golf Classic space is limited and assigned on a first-come, first-served basis.

APRO President's Welcome Reception
6–7:30 p.m., Monday, July 11
Peabody Grand Ballroom
Sponsored by Serta

Join us in honoring state presidents, APRO PAC and Team APRO contributors, and Congressional leadership. APRO President Robert Briley will recognize all those who have worked hard to protect the rent-to-own industry by being involved in the legislative process over the past year.

Business casual attire. Complimentary bar and light hors d'oeuvres.

Spouse/Guest Tour: Hot Springs' Historic Bath House Row
9 a.m.–5 p.m., Tuesday July 12

Less than an hour from Little Rock, Hot Springs is known as "America's First Resort." Famed Bath House Row has enticed guests for decades, especially during its heyday in the 1930s.

The tour will begin at Garvan Woodland Gardens on the shores of Lake Hamilton. After the tour and a private luncheon, we'll head to Hot Springs for a walking tour of Bath House Row, including a visit to the Fordyce Bath House Museum and Mountain Valley Water. We'll also have time to visit specialty boutiques, art galleries and antique stores.

This tour is included in the Spouse/Guest registration fee; however, space is limited and you must be registered in advance to attend. Check the appropriate box on your registration form (see page 27).

Gala at the Clinton Presidential Center
7–9 p.m., Tuesday, July 12
Sponsored by High Touch

APRO's private evening at the Clinton Presidential Center and Park will include food and drinks, entertainment, camaraderie with colleagues and tours of this unique facility. The center, located on the banks of the Arkansas River, is home to the William J. Clinton Presidential Library and Museum, University of Arkansas Clinton School of Public Service and the Little Rock offices of the Clinton Foundation.

Business casual attire. Complimentary bar and heavy hors d'oeuvres.

Exhibit Hall Cocktail Party
4:30–5:30 p.m., July 13
Sponsored by TRIB Group

Wind down and relax with your favorite exhibitors and fellow rental dealers — a perfect way to close out your first day of business on APRO's 2011 exhibit floor. Complimentary beer, wine and snacks.

APRO's Awards Reception and Banquet: "A Tribute To Sir Elton John"
6:30–7 p.m. (Reception)
and 7–10 p.m. (Banquet), July 13
Peabody Grand Ballroom
Sponsored by RentDirect Nationwide and Nationwide Southwest

Put on your 1970s rock-and-roll party outfit and your big sequined glasses and join APRO as we "remember when rock was young!" This elegant evening will feature Jeffrey Allen, who has performed as Elton John with Las Vegas' longest- running impersonator show "Legends in Concert." Also, we'll honor the industry's finest during APRO's awards presentations.

Semi-formal or 1970s rock-n-roll evening attire. Open bar during the reception, cash bar during dinner.

APRO's Convention Youth Initiative Award

APRO strives to encourage our youth — they're the future of the industry! Students currently enrolled in high school or college who are employed in the rent-to-own industry are invited to apply for a complimentary full registration to APRO's 2011 Convention and Trade Show. Contestants must submit a one-page essay on the topic of rent-to-own. It can include what you've learned about the transaction and the industry and/or how you feel the industry might fit into your plans for the future.

APRO's Youth Initiative Award will include a full registration to the Convention; travel and hotel expenses will not be included. To apply, send your one-page essay by mail or email and include the following additional information: name, address, telephone number, birth date, rent-to-own store where the student is employed; supervisor's name, address and telephone number; and the high school or college where the student is enrolled. Entries must be received by June 13. Send to Shelley Martinek, APRO, 1504 Robin Hood Trail, Austin, TX 78703; or email to smartinek@rtohq.org.

Bill Taylor: Practically Radical
APRO's 2011 Convention keynote speaker will get down to business

Chances are, not many people have ever said to Bill Taylor, "Mind your own business." If you're an entrepreneur who has heard him speak or read his books and articles, you'd be delighted to have him focus on your business. Taylor, cofounder of Fast Company magazine, is at the forefront of shaping the global conversation about the best ways for businesses to compete, innovate and succeed. On July 13, during the General Session at APRO's 2011 Rent-to-Own Convention and Trade Show, he will deliver the keynote address, sharing with rental dealers his insights into how to make your business extraordinary.

Taylor's keynote will address the themes developed in his latest book, Practically Radical: Not-So-Crazy Ways to Transform Your Company, Shake Up Your Industry and Challenge Yourself, a manifesto for change and a manual for making it happen. It's based on research of 25 organizations that have made deep-seated changes under very trying circumstances. Taylor was given deep access to these organizations — from hard-charging technology companies to long-established non-profits, from hospitals to auto makers to banks — and in Little Rock he'll unveil their strategies for redefining leadership in turbulent times, ideas from which every leader can learn.

"It's been fun learning about where the rent-to-own business is going," Taylor says. "In Little Rock, I'll talk about where business itself is going. I'll talk about strategy and why it's so important to rethink and re-imagine how your company does things. I'll talk about customers and why it's so urgent for you to connect with them emotionally, not just economically. And I'll talk about leadership and why smart leaders like those in the rent-to-own industry need to understand how to operate in a world where nobody alone is as smart as everybody together."

Practically Radical is a sequel of sorts to Taylor's Mavericks at Work: Why the Most Original Minds in Business Win, which was published in October 2006 to rave reviews. "I didn't just read this book, I devoured it!" says Tom Peters about Mavericks. James J. Cramer, co-founder of TheStreet.com and host of CNBC's Mad Money with Jim Cramer, says: "If Mavericks at Work had come out before I started The Street.com, I could have saved my investors (and myself) $100 million, because I would have been able to take the lessons in the book and apply them every day to my business."

Just weeks after its release, Mavericks became a New York Times, Wall Street Journal Business and BusinessWeek bestseller. The Economist named it one of its "Books of the Year, 2006" and other accolades included: "Top Ten Business Book of The Year" (Amazon.com), "Top Ten Book on Innovation and Design" (Business-Week) and "2006 Picks of the Year in Business Books" (The Financial Times).

As co-founder and founding editor of Fast Company, Taylor launched a magazine that has won countless awards, earned a passionate following among executives and entrepreneurs and has become a legendary business success. In less than six years, an enterprise that took shape in borrowed office space in Harvard Square sold for $340 million. In recognition of Fast Company's impact on business, Taylor was named "Champion of Workplace Learning and Performance" by the American Society of Training and Development.

In addition to his new book, Taylor also chronicles his latest research, insights and lessons on a popular blog, Harvard Business Online, the digital arm of the Harvard Business Review. A graduate of Princeton University and the MIT Sloan School of Management, Taylor lives in Wellesley, Massachusetts, with his wife and two daughters.

The Lure of Little Rock A perfect locale to combine business and pleasure

With a vibrant metropolitan area of 500,000 people, Little Rock boasts historic landmarks, an energetic downtown entertainment district, restaurants, specialty shops, museums and plenty of scenic beauty, making it a perfect location for business meetings and family getaways. Here are just a few of the places you should consider visiting while in Little Rock this summer:

In 1957, Little Rock was thrust into the national spotlight when Central High School (www.nps.gov/chs) became the site of the first important test of the U.S. Supreme Court's ruling in Brown vs. Board of Education, which held that racial segregation in public schools was unconstitutional. Nine black students, under protection of the U.S. Army, entered Central High in September 1957. Today, this national historic site commemorates civil rights struggles and achievements.

The William J. Clinton Presidential Center and Park (www.clintonpresidentialcenter. org) is a repository for the official records of the 42nd president. The Clinton Center includes two levels of exhibits featuring photographs, videos, interactive presentations and full-scale replicas of the Oval Office and Cabinet Room.

Downtown Little Rock's historic River Market District offers an outdoor farmers' market and indoor shops, with everything from gourmet coffee to fresh sushi. The area is bustling with new restaurants, bars, unique shops and museums.

A short distance from the River Market District is Quapaw Quarter, nine square miles of beautifully restored 19th-century homes, MacArthur Park and the Governor's Mansion.

Located in historic MacArthur Park, the Arkansas Arts Center (www.arkarts.com) features elegant art galleries showcasing an acclaimed collection, including works by Cézanne, Van Gogh, Jackson Pollock, Georgia O'Keeffe, Rembrandt and Rubens.

Little Rock's Old State House (www. oldstatehouse.com) was constructed of handmade brick in 1836 and served as the state capitol for 75 years. It continues to inspire as a history museum today.

The Arkansas State Capitol Building is a smaller-scale replica of the U.S. Capitol in Washington, D.C., and is often used as a stand-in for the real U.S. Capitol in movies.

Take a walk on the longest pedestrian and bicycle bridge in the world. Elevated up to 90 feet above the Arkansas River, the Big Dam Bridge (www.bigdamnbridge.com) connects approximately 17 miles of scenic riverside trails and assists in the connection of 70,000 acres of park land.

Heifer International (www.heifer.org) is a humanitarian organization dedicated to ending world hunger and caring for the earth. The Heifer International Center reflects the organization's efforts. There, visitors learn about Heifer's mission, the "green" features of the building and the organization's commitment to responsible use of resources.

Don't miss the famous parade of ducks! Each morning at 11, the clan departs their Royal Peabody Duck Palace and heads via a red carpet to the ducks' daytime home, a marble fountain in the lobby of APRO's host hotel, The Peabody, where they frolic all day.

The Arkansas Inland Maritime Museum (www.aimm.museum) is home to the USS Razorback, the longest-serving submarine in the world. The museum commemorates America's rich naval and maritime heritage through the preservation and exhibition of historic vessels.

Little Rock's Visitor Information Center is located in Curran Hall, a beautifully restored historic home with gardens designed to replicate the 1840s antebellum period. For more information about Little Rock, visit www.littlerock.com. Tours of the city are available through Little Rock Sightseeing Tours, 800/933-3836, www.littlerocktours.com.

We'll See You at The Peabody!

Experience the height of elegance and guest services at The Peabody Little Rock. Enjoy the smile-inducing March of The Peabody Ducks, savor tantalizing cuisine presented with panache and flair at the world-class Capriccio Grill Italian Steakhouse and soothe tired muscles in the hotel's relaxing sauna. Located in the heart of the bustling downtown River Market District, The Peabody Little Rock offers unsurpassed luxury and well-appointed guest rooms. It boasts a Forbes Four Star and AAA four-diamond luxury hotel rating and is conveniently connected next to the Statehouse Convention Center.

Who Says Business and Pleasure Don't Mix?

Take advantage of APRO's 2011 Convention and Trade Show to enhance your business while enjoying some personal time with your friends and family. There are many great sights to see in the Little Rock area, so plan to enjoy some leisure time while you're there. The Internal Revenue Service's rules on business travel deductions are available at www.irs.gov/taxtopics/tc511.html. For more information on Little Rock, visit www.littlerock.com.

Registration in Three Easy Steps

Step 1: Travel. Driving? Flying? Whatever your mode of transportation, one reason Little Rock was chosen for APRO's 2011 Convention is because of its accessibility. If you're flying, be sure to book your flight early to get the best rates. If you are driving, valet parking at the Peabody Hotel is $21 per day. There is also off-site parking nearby for $7.50 per day.

Step 2: Hotel Reservations at the Peabody Little Rock. The discounted APRO rate at The Peabody Little Rock is $129. For reservations, call The Peabody at 800/732-2639 — or reserve your accommodations online through the APRO website at www.rtohq.org. For suite information and reservations, contact Shelley Martinek at APRO, 800/204-2776, ext. 109. Important! You must book your room in the APRO block at The Peabody in order to get discounted convention registration rates. Your hotel confirmation number will be required on the registration form, so book your room first. The hotel reservation deadline is June 13.

Step 3: APRO Convention Registration. The APRO member rate for full registration is $349 for those who book in the APRO room block at The Peabody Hotel. Other registration rates are listed on the registration form on the facing page. The Convention pre-registration deadline is June 24. You may also register online at www.rtohq.org.

Rent-to-Own Family Matters
Part II: Profiles by Kristen Card

In this issue of RTOHQ: The Magazine, we continue our series on family-run rent-to-own businesses with profiles of the Tinneys of North Carolina, Fryes of Pennsylvania, Bobbie Floyd and her sons, Chad and Derek Mitchell, of Virginia, and Rhonda Weatherford of Arkansas, who, along with her sons, keeps the legacy of her father, Don Cecil, alive. As we gear up for the Rent-to-Own "Family Reunion" at APRO's Convention and Trade Show in Little Rock this summer, we thought it highly appropriate to honor the industry's strong sense of family in our magazine — both literal kin and the proverbial collective that we call APRO.

The Fryes
Premier Rental-Purchase, Altoona, Pennsylvania, www.premierrents.net

For Sandi Frye, more isn't necessarily better. For example, her involvement in rent-to-own began in 1993 with a simple parttime secretarial position at Rainbow Rentals. While she was happy when the role she played at Rainbow grew.first to full-time and eventually to manager of the Altoona, Pennsylvania store.it was a different story when the company grew big enough to be bought by Rent-A-Center in 2004.

"The transition to Rent-A-Center was culture shock for me," Sandi says. "Rainbow was extremely family-oriented and flexible. With a much bigger company, there was naturally less flexibility.flexibility that I needed as a working mom."

Within a year, Sandi left to open her own Premier Rental-Purchase franchise in Altoona. A Rainbow colleague of several years, Mike Frye, went with her to help; within two years, the couple married, blending their five children from previous marriages into a single family with a single store. Which is not to imply this family-run business was a happily-humming-along venture.like the Von Trapp family renters.immediately.

"We tried to get the kids interested in the store when we were first opening," Sandi recalls. "They wanted nothing to do with it. But as they matured, all of a sudden, they wanted to give it a try. You can't push them into it, because rent-to-own, you either love it or you hate it. But now, they're hooked. They love it.the benefits, the hours, the sort of work they do."

Mike's son, Mike Jr., worked at the family firm as an account manager until last year, when he left to become an entrepreneur. Sandi's eldest, daughter Ebony, has worked at both Premier and Majik Rent-to-Own. Daughter Nicole, 19, and her Air Force husband both were Premier employees until his recent relocation for boot camp and Sandi's youngest, 15-year-old son Matt, continues to help around the store. Sandi's mom, Winnie, even handled the company's bookkeeping for a while, but now does the store's shopping "mostly for entertainment purposes," Sandi chuckles.

For the Fryes, the secret to keeping both the family and the business successful is a clear separation of the two. "Mike and I never discuss work at home.we don't want it to consume our life," Sandi says. "It's always Åebusiness is business' and the same goes for the kids. When we're at work, I'm not your mom, I'm your boss. And whatever the rules are for everyone else are the rules for you. It keeps it fair for all the employees, family or not."

Yet it's almost impossible for a family feeling not to creep in to the way the Fryes do business. And from Mike and Sandi's perspective, as long as it's kept in check.not too little, not too much.it can be a good thing.

"When you're shopping in a family-owned store, there's a more personal touch, a warmer rapport," Sandi notes. "We don't take anybody for granted and we try to be compassionate and understanding. When a customer has an issue, we make the extra effort to work with him or her."

"It is more personal," Mike agrees. "And that translates across the counter to the customers. They feel like they're part of the family, too."

Bobbie Floyd and The Mitchells
Aaron's Sales & Lease Ownership, Danville, Virginia, www.shopaarons.com

Chad and Derek Mitchell and their mother, Bobbie Floyd, are no strangers to change. Sure, from 1981 to 1995 — for 14 years — life was fairly smooth and solid for the Mitchell family. They were settled in Danville, Virginia, with a successful retail-turned-rental TV and appliance store. Kelly Rentals was growing steadily, with a dozen locations in two states by 1995.

And then the bottom fell out. The family's patriarch, Grady Mitchell, died unexpectedly, leaving Bobbie to manage a thriving business while both boys completed college. Luckily, Bobbie had several longtime employees — including the first two she and Grady ever hired — to help. And luckier still, more help was on the way.

"The boys grew up in the store," Bobbie explains. "So when they got out of college, they wanted to come back to the business. You can't put it on your children; they have to choose it. But if they hadn't wanted to come back to it, then I might not have stayed in the business."

Chad and Derek brought youthful drive, fresh perspectives and a sense of renewal to Kelly Rentals. They continued growing the company, doubling the number of stores over the next 12 years and extended their investments into real estate, real estate holdings and property management.

"They've definitely contributed a lot to the business," says Bobbie, now remarried. "They've got lots of great ideas percolating all the time. Sometimes, you need young folks to get you to try different things." Probably the biggest change the business has undergone was the family's 2009 decision to transition their company to Aaron's Sales & Lease Ownership. For the past two years, they have been busy converting their 25 Kelly's stores to 17 Aaron's locations, while preparing to open up three more locations later this year.

"We were extremely impressed with [the Aaron's] model," Chad says. "We felt like it was the best decision at the time and we've been happy ever since. Growing with a franchise is a little different, but we'll be at 20 stores this year and we intend to keep on growing the business as big as we possibly can." While the sign above the stores might have changed, the way Grady and Bobbie taught their sons to do business remains — and remains successful.

"We were raised to be honest and I think that goes a long way in business," Derek says. "We were given a good work ethic — we were working at an early age and were expected to get a job, get the job done and do it with integrity. We learned always to take care of our customers and always have the best price. Dad said, 'Do those two things and you'll have customers for life.'"

"When our dad passed, Derek and I both saw a great opportunity in what he and our mom had started and we were both up for the challenge," Chad concludes. "There wasn't any pressure at all — we just saw it as a great chance to carry on what they had begun. I think if he were still living, then he would have made the same choices we have. I believe he'd be proud."

The Tinneys
Rent America, Fayetteville, north carolina, www.rentamerica.com

When APRO holds its annual convention and trade show in Little Rock, Arkansas, this July, it will be a stroll down memory lane — the matrimonial aisle for Larry and Brenda Tinney. "We got married just outside of Little Rock, in one of the state's oldest brick homes, called the Ten-Mile House," Larry says. "It was the first stagecoach stop from town and was used by the Union to house prisoners during the Civil War. We definitely want to visit while we're there."

A suggestion of vow renewals elicits a chuckle from the couple. "We renew our vows on a daily basis," Brenda laughs. "Some days more often than others."

With 46 years of marriage and 31 years in business together, a restatement of commitment does seem rather redundant. From head cheerleader and star quarterback at Athens [Texas] High School to the owners/ operators of Rent America, an award-winning, 15-store company headquartered in Fayetteville, North Carolina, the Tinneys have come a long way — together.

"When we started out in 1980 as a Color- Tyme franchise, there were a lot of bosses," Brenda recalls. "And I said to Larry, 'This isn't going to work. There's got to be one boss and that's going to be you.' We're equal partners, but there's one boss. That's the way it works; that's why it works." The ColorTyme affiliation lasted only three years, but the division of labor between the pair has endured — and has extended to their two children, who also help run the family business.

"Larry has the financial area; our son Darren does operations and marketing; Kay, our daughter, covers bookkeeping and human resources; and I take care of inventory and accounts payable," Brenda says, adding lightly, "So Larry makes the money and I spend it."

Larry and Brenda agree that the biggest benefit of a family-run business is the everyday engagement with their kids — not only the interaction, but also the greater intention beneath it. "We get to be together with some unity and familial purpose," Larry says. "Working together, pulling for the same results and goals. It's heartening to know everybody truly cares about what we're trying to achieve. We're very blessed to have our family involved."

And Larry means to stay that way — involved. At 65, he and Brenda have no plans for imminent retirement; they both say they're having too much fun in rent-to-own to quit now. "My theory is that working keeps you young," Larry says. "I don't see myself staying home, which may be much to the dismay of the children. I do see them running the business, but I want to keep working as long as I enjoy coming to work and I can contribute. Folks ask, 'Don't you have a boat or a beach house [to retire to]?' and I say, 'No, I believe in renting.'"

It's difficult to tell whether the Tinneys strong marriage has helped their business succeed or vice versa. But whichever way you slice it, quips Brenda, "We have a lot in common."

"At home, we find ourselves talking about work — but at least we have something to talk about," Larry concurs. "You see lots of couples sit there and stare at each other, but we're always talking. People don't know whether we're talking about love or business — and it really doesn't matter."

Cecil, Weatherford & Cummings
Don's E-Z Pay, Mena, Arkansas

"It all originated with my dad, Don Cecil." More than two years since her father's passing from cancer, Rhonda Weatherford's Arkansas drawl is still fresh with grief as she begins the story of her family rent-to-own business.

"He always wanted to be self-employed," she continues. "He was in the Air Force, he drove a chicken truck, he had a car lot, he built apartments and he did some appliance repair. He really had a dream of being his own boss and running his own business, so in 1982, he opened up a used furniture store. He started out with nothing, but it grew.

"He was a humble man," Rhonda remembers. "He just wanted to help people — so he let them pay things out, week by week, and the next thing he knew it had blossomed into this rent-to-own thing. People thought he was insane, but it worked. He was really a rent-to-own pioneer."

Almost 30 years later, Don's E-Z Pay is still going strong. With Don Cecil's only child serving as its leader, the company employs more than 25 people at one Oklahoma and three Arkansas locations, with another readying to open later this year. You'd never know Rhonda wasn't raised behind the rent-to-own counter.

"My dad always worked a lot — worked two jobs at a time while I was growing up — and my parents divorced," Rhonda explains. "So I never really got to know him then. About 15 years ago, I was working as a nurse when my dad got ill and needed to take some time off, so I began helping him. Well, he was gone for a year, so I just sort of stumbled my way through and here I am now."

Rhonda took on the massive task of transitioning the company from ledger books to computers and picked up the arts and sciences of hiring, firing, bookkeeping, purchasing, etc., as she went along. But her best learning experience came once her father returned to work alongside her.

"The years we got to work together, we really got to know one another — and it was awesome," Rhonda recalls. "We got to be like best friends. We could practically read each others' minds, that's how our relationship was.

"He always did people right," she continues. "He taught me [that] when customers come through that door, make them feel special, because they are. Work with them any way you can so that they can obtain ownership of the product, because that's our business — rent-to-own, not rent-and-pickup- later. So we go above and beyond to help people own the product."

Today, Rhonda is proudly passing her father's wisdom along to the next generation. Her son, Brandon Cummings, currently manages the Mena, Arkansas, store, but will soon be moving up to operations manager once brother Aaron Cummings joins the team to take over the Mena location. A third son, Calvin Cummings, is committed to the Air Force for a few more years, but also intends to come home and become part of the family firm.

"My dad sacrificed so much to make things easier for his customers and for his family," Rhonda concludes. "He's left us a legacy and we're going to take good care of it. I really think Dad's watching — and he's probably just pleased as punch."

As the Rental World Turns - Part II
By Ed Winn III

More Lessons Learned from Some Thought-Provoking Circumstances

Here are more real life cases from the rental world with spellbinding stories of mayhem and madness with lessons for us all. Some of these stories are a little dark. Some of life in the rental store can get that way sometimes. And, remember, these tales come from court records, so there was a real conflict that time and TLC could not make go away. We are in a tough business, and we run up against some tough customers. Happily, most of the despicably tough ones end of up in jail, some for a long, long time. So, take an antacid and read on.

A Sofa by Any Other Name... Is it Still a Sofa?

R In New York State, Mr. Davis rented a new 10-piece sectional seating group, commonly referred to as a "conversation pit." Davis was renting weekly and, after four weeks (which included timely payments), he decided to rent two used end tables and a matching new coffee table to go with the conversation pit. He entered into a second agreement with the rental dealer. The conversation pit was rolled into this second agreement. Over the course of the next 12 months, Davis made 36 payments, equal to 50 weeks, more or less, on the 87-week agreement. Some payments were timely; some not; some were double and even triple payments. According to the court's calculation, Davis paid $1,392 out of the total rent-to-own price of $2,262, or 61.5 percent of that amount. At that point, he voluntarily surrendered all of the property back to the rental store because, as Davis explained to the dealer, he was moving to a new apartment. He also told the dealer that the surrender was going to be temporary and that he intended to reinstate the agreement to get the furniture back once he was settled into his new place.

The store manager testified that given Davis' sporadic payment history, he did not anticipate that Davis would, indeed, reinstate, and so he did not put a hold on the furniture. When the opportunity presented itself, the store manager rented it all to someone else.

Two months later, Davis came back into the store to reinstate his agreement only to learn that his treasured conversation pit was no longer available. The store offered Davis different living room furniture, including a sofa, love seat and chair. Davis refused the substitute furniture and sued.

The court had to focus on the meaning of "substitute merchandise" in the New York rental-purchase statute. The court noted that the condition and quality of the two sets of furniture were comparable. They were of "similar price, durability, workmanship [and] age, and both were in fairly new shape." The court went on to note, however, that the "character" of the two sets was different and that a sofa, love seat and chair are not a "substitute" for a 10-piece sectional conversation pit.

The court acknowledged the need for balance in such situations, stating: "The law must be careful not to hold merchants to too high a standard in transactions like the one at bar. We certainly can't expect rental purchase dealers to have two of everything or to become warehousemen, holding surrendered goods for the statutory time limit in order to cover every eventuality. The consumer should not have an expectation that he'll get back the same or nearly the same merchandise he surrendered. So long as the substitute merchandise is of the same quality, condition and character, it satisfies the law, even though it may not satisfy the subjective taste of the consumer. This is a risk that consumer must assume when he surrenders rental-purchase goods."

Inevitably, courts will have to decide what is and what is not acceptable substitute personalty on a case-by-case basis. Is a non-cable-ready television a substitute for a similar, but cable-ready, set? Is an armless chair a substitute for one with arms?

The court considered several different measures of damages and ultimately awarded Davis damages equal to half of what he had paid on the accounts, looking at the statutory buy-out provision in the New York law and concluding that half of all rental payments went for the use of the property and half toward ownership, which Davis was denied.

Lesson: With reinstatement issues, it is supremely important to make the customer happy. The company had probably quit carrying conversation pits in this case and one can only wonder what other items rental dealers will quit carrying over a "lifetime." What will you do when a customer wants to reinstate an agreement for a VCR next week? When Sears does not have what a customer orders out of the catalog, its policy is to step the customer up to the next better product in the line at no extra charge. Be careful with reinstating customers. By the time you pay off your lawyers and the unhappy customer, you will have made a very bad deal if you insist on being too fussy.

To Catch a Thief, You Might Catch a Liar As Well

R In Arkansas, Mr. Johnson pled guilty to burglary, theft and felonious possession of a firearm and was given a six-year suspended sentence. The next year, while still on probation, Johnson was arrested for failing to report to his probation officer, failing to pay probation fees and filing a false police report. He was convicted on all three counts and sentenced to serve time in the penitentiary for 20, 10 and six years, respectively, with the sentences to run concurrently.

At the trial, a detective testified that Johnson originally filed a police report swearing that his mobile home had been broken into and burglarized by his uncle and a cousin and that they had taken a radio, washer and dryer, VCR, television and $10 in cash. Police investigated and found that several items in the trailer had been destroyed.

Later, Johnson approached the detective in charge of the burglary investigation, explaining that he wanted to give a second statement. This time he admitted that he had sold the washer and dryer and had destroyed some of his own property to make it look like some burglars had done it. The rental dealer who had the misfortune of having Johnson as a customer testified at the trial that he had rented the washer and dryer, VCR and television to Johnson and that Johnson was behind on his payments.

Johnson took the stand on his own behalf and testified that his second statement had been coerced by the police and was not true.

On appeal, Johnson argued that there was not enough evidence to convict him on the charge of filing a false police report. The appeals court pointed to the second statement — in effect a confession that Johnson had lied to the police — and affirmed the conviction. Johnson is serving his 20.

Lesson: It does not pay to steal televisions. It pays even less to lie to the police. Johnson has 20 years to figure this out. You figured it out in the time it took to read this article. These days, you can check the criminal records of would-be customers. People on parole for theft might not make good rental customers.

Name the Defendant — and Make Sure You Have the Right One

R Mr. Bragg and his girlfriend decided to move in together into an apartment in Georgia. Shortly thereafter, they went to the rental store, one in a six-store chain, to get a washer and dryer for their new place. Bragg was too new to town to qualify for an account and so his girlfriend signed the rental agreement. When the units were delivered, she also signed the delivery receipt. Later that month and before any payments were made on the account, the love birds broke up and Bragg moved to Texas.

The girlfriend made no payments on the washer and dryer, nor did she call the store to come pick up the units. It is unclear why the store did not try to collect from the girlfriend, but apparently no one ever did. One possibility is that Bragg filled out the rental application originally and the store did not have any information on the girlfriend — although, presumably, someone in the store had a record of the address where the units were delivered.

In any case, since the account was effectively a first-payment default, the company owner instructed the store manager to swear out a warrant for the girlfriend's arrest. For reasons unknown — call it human error, for lack of any better explanation — the store manager swore out a warrant for Bragg instead of the girlfriend.

The store manager stated in his sworn testimony: "I do not remember taking a warrant for Bragg, but while I was manager, I took out warrants on several people. I was not allowed to choose the person to take a warrant for... The [owner] always told me who to take the warrant for. He would have had to tell me to take out a warrant for Bragg."

A year later, Bragg returned to Georgia and — surprise, surprise — in due course, was picked up on the outstanding warrant for theft by conversion of the washer and dryer. The charges were eventually dismissed because of insufficient evidence (no rental agreement with Bragg's name on it, for example). Bragg then sued the rental company for malicious prosecution. The company's defense was that the store manager — not surprisingly, the former store manager — was acting outside the scope of his employment when he had Bragg arrested, because the instruction from the home office was to have the girlfriend arrested, not Bragg.

The question of whether an employee was acting within the course and scope of employment, in which case the employer is liable for the employee's conduct, or whether the employee was "off on a frolic of his own," acting outside his employment, in which case the company is not liable, is usually a question for the jury, but in clear cases, the judge can decide the issue.

This was just such a clear case. The person who signed the affidavit for the arrest warrant was the store manager at the time. He had company authorization to swear out an arrest warrant for the theft of the washer and dryer. The court, ruling against the rental company, explained: "The fact that [the store manager] disobeyed, ignored or misunderstood [the owner's] instructions to have the girlfriend arrested rather than Bragg is unfortunate, but irrelevant for our inquiry... The undisputed evidence shows that [the store manager] swore out the affidavit for the arrest of Bragg for the sole reason that he thought he was instructed to do so by his employer."

It did not matter to the court that the rental company did not know its employee had the wrong person arrested, or that the company did not authorize the action, or even that the company disapproved or forbade it. The only issue for the court was whether the employee was attempting to further his employer's business by his actions — and the undisputed evidence is that he was, however clumsily. There was no evidence, for example, that the store manager even knew Bragg or that the store manager had any kind of personal vendetta against him. The store manager had Bragg arrested as part of his job.

The record in this case does not indicate how much the company had to pay Bragg in damages. This is likely because the company settled off the record once the court ruled against it. Nor do we know the details of the arrest — for example, whether Bragg was cuffed in public, whether he may have turned himself in once he heard about the arrest warrant, how long he was kept in jail, etc. When successful, malicious prosecution cases against rental companies — not all that rare, by the way — often result in judgments in the $10,000 to $30,000 range.

Lesson: Filing criminal charges of theft against rental customers is always risky business. The paperwork has to be perfect. Eye-witnesses help and, in an industry with relatively high turnover at the store level, they can be hard to find when cases finally come to trial months or even years after the theft. Convictions only occur when there is proof "beyond a reasonable doubt." If a customer is arrested but not convicted, most of them will sue the rental company. Wouldn't you? Get it all exactly right, assuming that the police will take the complaint, the district attorney will prosecute theft of rental property cases and the customer will go to jail. Get it even a little bit wrong and you will end up writing a check to the customer who stole your television.

A Fanciful Take On the Debate Over Lease Versus Sale

R Mr. Jackson rented a two-piece living room suite and a queen mattress and frame in Alabama with a stated cash price of $1,300 for all items. He made regular and timely payments for three months and then sold the items to a used-furniture outlet a couple of towns away, telling the furniture dealer that the items had been fully paid for and were his to sell. When the rental dealer learned of the sale, he filed a criminal complaint against Jackson alleging second-degree theft of property (the degree of theft relates to the value of the property stolen).

Jackson ultimately pled guilty to the charge and was sentenced to three years in prison. The sentence was suspended and he was given probation for three years. When he pled guilty, Jackson reserved the right to appeal on the "lease versus sale" issue.

On appeal, Jackson argued that his transaction with the rental store was really a disguised security transaction, that title had passed to him before he sold the property and that, since the rental store no longer owned the property, he could not be convicted of theft.

The appeals court analyzed the history of "lease versus sale" cases in Alabama, scrutinized the terms of Jackson's rental agreements, including such details as the rental store's responsibility to pay any personal property taxes levied on the rented items. The agreement was a typical rent-to-own transaction, presumably in compliance with the Alabama rental-purchase statute, although the court did not make reference to that law. After reviewing the terms of the rental agreement, the court affirmed Jackson's conviction and sentence.

Lesson: When you are up against it, you will make any argument that you can — be it logical, fanciful, illogical or otherwise. If the government is paying for your lawyer, there is no harm in trying. It's free and so try they do, rental thieves and others, to stay out of jail. Sometimes it works; usually it doesn't.

Don't Sell a Television You Don't Own to Someone Else

R Airman Boddie, a U.S. Air Force security policeman, rented a big-screen television, stereo, couch, chair, two tables and lamp from a rent-to-own store close to the base. Soon he realized that he was overextended and could not keep up with his payments to the rental store along with his other financial obligations. He painted over the name of the rental store on the television and stereo and sold them. He also attempted to sell the furniture. According to Boddie, his plan was to use the money from the sale of the rental property to pay off his other bills. Then he could continue to pay on his rental account at the rent-to-own store and, if he stayed current, the rental store need never know that he had sold its merchandise.

The plan did not work. Soon after selling the television and stereo, Boddie once again found himself in financial trouble and wrote hot checks, four of them. When he discussed the bad checks with his squadron commander, he explained his scheme with the rental merchandise, an admission that led to his court martial.

At the court martial, Boddie pled guilty to larceny and four counts of writing bad checks. Larceny is defined under the Uniform Code of Military Justice as: "the act of intentionally and permanently depriving the owner of the use and benefit of the property or of appropriating the property for his own or another's use." Boddie was convicted and sentenced to a bad-conduct discharge, hard labor without confinement and a reduction to E-1.

Boddie appealed his conviction to the Air Force Court of Criminal Appeals and that court reversed his conviction on the grounds that Boddie did not have the required intent to plead guilty to larceny since he intended to pay the rental company the full value of the property he had taken. As such, his conduct amounted to nothing more than a breach of contract.

From that ruling, the prosecuting officer appealed to the Armed Services Court of Criminal Appeals. This court reinstated the conviction for larceny, holding: "The intent to pay for the property taken or otherwise to return its equivalent is never a good defense unless there is a substantial ability to do so; a mere hope, under circumstances disclosing little foundation for optimism that one can replace or pay for the property, will not do."

There was a vigorous dissent to the decision that began, "This could be an important case in the world of rental debts for the military — important not only for the stability of the law, but for fairness in punishment..." The dissenting judge interpreted Boddie's plan as indicating merely a temporary rather than a permanent taking of property that belongs to another. The judge pointed to previous military justice cases in which the use of a rental car beyond the terms of the rental contract, for example, did not amount to larceny. The judge noted that there was no evidence in the record of the "fact" of "little hope" that Boddie could successfully pay off the rental store. The judge noted that Boddie had a full-time job and "perhaps he would have continued to make the [rent-to-own] payments with proper management of his paycheck." Yeah, and maybe Boddie would have become a jet pilot and risen to the rank of an Air Force general, too.

The dissenting judge did not like the rent-to-own business; his opinion reflects this attitude: "Under the [rental agreements] Boddie... over the contract life, would have paid over twice the retail cost of these items — a good deal for the [rent-to-own store], but a bad one for Boddie."

Lesson: The military wants its service members to be financially responsible. Woe unto those soldiers who steal rental merchandise, even with the best and most creative of intentions, and also to those who write bad checks. If you have trouble with a soldier, don't be shy. Go to the base commander. Often, he or she will help.

A Christmas Story Your Children Wouldn't Enjoy

R Twas the night before Christmas eve, December 23, in a Missouri rental store, around 7 p.m., when the store manager sitting in his office in the back noticed two males come into the store and walk straight up to the back counter without slowing down to look at any merchandise along the way. The store manager stepped up to the counter where the cash register, jewelry cases, camcorders and digital cameras were on display and asked the two men if he could help them. One of the men replied that they were just looking and, shortly thereafter, the two left, again walking straight out without pausing to look at any merchandise.

The next morning, Christmas eve, the store manager got to the store around 7:45 a.m. to prepare for the store opening at 8. Just after the store opened, a young woman came in to look at some furniture. The other employees were in the back and so the store manager began assisting her. When he bent down to examine some scratches on a bedroom set that the customer had pointed out, the customer suddenly ran out of the store. The store manager then saw that the two men from the night before were back. They were certainly the same two. "It just stuck out like a big thumb," the store manager testified. "I kept the Shirley Temple curls and big nose and forehead stuck in my brain because I had just seen them yesterday [and remembered] the fact that they were acting kind of weird [when they came into] the store."

Upon their return to the store, the man with the curls, Mr. Washington, pulled a gun on the store manager and ordered him to the office in the back. The store manager did as he was told and when the three of them got to the office, Washington ordered him to open the safe and put the contents on the floor, which he did. Washington then told him to give him his wallet and to empty his pockets. Washington put the cash from the safe, some $1,300, in a bag, as well as the store manager's wallet and cash. The two men grabbed a camcorder and a laptop that were in the office. Then, Washington and his accomplice duct taped the store manager's hands and eyes and ripped the telephone out of the wall. Washington told him not to move and the store manager next heard the cash register ding and then the sound of running feet. In due course, the store manager managed to free himself from the duct tape and call the police.

The store manager told police that he usually made a bank run every morning between 9 and 9:30 with the receipts from the day before. He also told police that the security cameras had been out of order for a couple of weeks and that he had told all his employees of this fact so that they would all be extra alert in the store. The police examined the crime scene but did not turn up any credible leads.

Two months later, the store manager got an anonymous phone call at the store from a woman who told him that she knew who had robbed the store. She told him that it was Washington and another man she named. She said that she knew they had taken a laptop, which they subsequently sold for $500, and that they knew that the store's delivery drivers did not come to work until 9 a.m. The robbers also knew that the store's security cameras were out of order. The store manager thought that some, although certainly not all, of what the caller told him was the truth because the laptop information had been withheld from the public report on purpose; only the store manager, district manager and police knew about the theft of the laptop.

The name the caller gave as Washington's accomplice was one of the store's delivery drivers and the store manager knew that the driver was not one of the two robbers. The caller told the store manager that the driver had set up the robbery because he was mad at the store manager. The store manager called the police with this new information and then went to the station, where he picked Washington out of a photo line-up almost immediately.

The police initiated surveillance at Washington's last known address, but never saw him. However, two weeks later, Washington walked into the station and turned himself in. He was read his rights and interviewed by three policemen. He told them that he had been involved in the robbery of the rental store with his cousin (not the store's delivery man) and that they had taken cash and a laptop. He also stated that he had used a fake gun. He wrote and signed the following statement in the presence of the three policemen: "The incident that took place was a robbery, which involved money and a laptop that me and my cousin took. And I am trying to get the laptop back in a week."

At his trial 18 months later, Washington did not testify. However, the store manager and the police officer in charge of the investigation both testified at length. The jury saw the signed confession. The jury convicted him of first-degree robbery and sentenced him to 20 years in the state penitentiary.

Washington appealed, as convicted felons sitting in the pen with nothing to do are wont to do, claiming that the testimony concerning the anonymous phone call was hearsay and should not have been admitted and that, without the hearsay testimony, there would not have been enough evidence to convict him.

The appeals court patiently explained that in addition to the evidence of the anonymous phone call — which may or may not have qualified as hearsay evidence under state law — there was also the credible and detailed eyewitness testimony of the store manager. Oh, and by the way, there was also Washington's written confession to the crime. In other words, there was plenty of evidence to convict without the evidence of the telephone call, which, under the circumstances, was not prejudicial or, as the court referred to it, "outcome determinative."

The court affirmed the conviction and the sentence. Washington is currently scratching out the days of this sentence on the wall of his cell.

Lesson: When someone pulls a gun on you, do what he/she says. We do not want dead heroes in our rental stores. Hone your instincts for trouble in the store. There is often advance warning that trouble is coming. It's often in the air and you can sense it. Pay attention when things suddenly no longer feel right. And keep the damn security cameras working! How hard is that?