American Rental’s Visit with Indiana Senator Todd Young
Last week, Full-O-Pep Appliances Inc., dba American Rental’s APRO Executive Committee Member David P. David and Board Member Dennis Adams hosted Indiana Senator Todd Young at the company’s headquarters in Bloomington, Indiana. Their goal was to tell the rent-to-own story so Young would have a better understanding of the RTO industry.
The visit began with a tour of facilities, starting with American Rental CFO Kevin Rankel’s office, specifically the memorial wall that pays tribute to his son, Marine Sgt. John K. Rankel, who died as a result of injuries received in Afghanistan in support of Operation Enduring Freedom. Young, an ex-Marine, received a personal letter from Kevin along with one of his son’s challenge coins.
David and Adams told the story of American Rental, from its early beginnings as a modest retail store to the multi-location corporation it is today. Young asked how the business is affected by the economy’s varying climates to which American Rental President David replied that it wasn’t. To illustrate, David gave an example of why people chose to RTO, “if we lost our jobs, we can just turn it back in.” He went on to talk about how the industry has evolved, developing the six months same as cash buying plan and that with American Rental, 100% of the rental payments go towards purchase.
Another example, given by Adams, explained how customers want to have the same things everyone else does and RTO makes that possible. “Instead of going to a laundromat and paying $40, they can actually have a washer and dryer in their home for only $20 a week, and eventually own it,” says Adams.
Young then asked if there were other revenue streams generated such as service, David explained that American Rental continues to service what customers have come to own up to six months to a year after the purchase. “For example, with electronics, the replacement costs are comparable to repair costs, so most people opt to replace them rather than pay to have them repaired.,” says David.
Adams then brought millennials into the conversation, he talked about how they prefer to rent because they want to be mobile. “In three months, if they decide to move,” he explained, “they just turn it back in.”
Young stated that there have been roundtable discussions regarding how to help people who are struggling to remain in the middle class and those wanting to get there, “it strikes me that you’re part of the solution to that.” He talked about how customers are getting a better value than they could afford otherwise and how people who are working a minimum wage job can never find a pathway into ownership.
“We truly help our customers learn to budget,” says Adams. “Those life skills aren’t being taught. Customers pay us when they get paid, and we help them stay on track—they will say, ‘I own this washer and dryer, and no one can take it from me,’ and we sometimes forget how huge of a deal it is.”
David recalled a waitress who used to make her payments with quarters. He said that she came in with a bag of quarters and told them that her friends had given her a hard time about renting, but that she was making her last payment that day and would now own the items. Young’s response was that he could see how they were personally touched by these stories. Adams explained how family oriented the company is, not just with customers, but with colleagues, “David’s mother was my first manager in Columbus and she was great!”
David addressed the laws safeguarding the RTO industry in 48 states and how RTO representatives were in Washington when Evan Bayh was serving as an Indiana Senator, trying to get legislation passed; Bayh was supportive of the industry. “We’re just keeping our name in front of people and helping legislators understand the business we’re in,” says David. He added that American Rental is overseen by the Department of Financial Institutions (DFI). The business part of the meeting ended, “You’re in the business of helping people realize their dreams,” says Young. “It seems like the best thing we can do for you is to stay out of your way.”
Young, his assistant Hal Turner and district director Thomas Barclay were given a tour of the flagship American Rental store in Bloomington as well as the warehouse, both housed in the same building as the corporate offices. During the tour, Young met store manager Sharon Lidberg who has been with American Rental for 24 years, and her staff, including Lance Adams who has been with the company for 30 years.
During the warehouse tour, David showed the visitors a stack of tires, explaining how a typical customer of ours would come in with the cords showing on their tires and how typically, they would buy one tire at a time to replace the worst one because it was all they could afford. Adams agreed saying that about 70% of customers can’t afford new tires, and that by renting, they could afford to run on a complete set of good tires.
Moving through the warehouse, Adams told Young that the tax cuts had helped not only customers, but also employees. Young greeted various employees, sharing that he was there to learn more about the place they work and the work they do, “I want to learn about people’s lives and people’s businesses.”
One employee, Roy Brown, explained how he had worked two jobs before, but was now working full time for American Rental, “David took care of me,” says Brown.
Another employee, Corey Plunkett, got the opportunity to update the senator on his son. Plunkett approached Young after a speaking engagement in Bloomington some years ago, hoping for a meeting with him. It wasn’t on his schedule, but the senator took the time to sit down with Plunkett and his son, Tyler, who wanted to serve in the military but due to a minor health condition required a waiver to enlist. Young sat down with the two of them and listened and Plunkett was happy to report that Tyler is now a sergeant in the military, stationed at Clarksville, Tennessee, after serving in Afghanistan.
Young and his staff also learned of the various philanthropic efforts American Rental is involved in, such as supporting Court Appointed Special Advocates (CASA) and the Boys & Girls Clubs. American Rental also does a corporation-wide fundraiser to help Riley Hospital for Children and Korsair Children’s Hospital.
Before the visit concluded, David brought up the issue of tariffs to which he replied, “If anything ends up creating challenges for you or your customers, let’s be in touch.”