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Trend Or Fad? When Should You Invest In New Technology?

Remember that the decision you make today will affect your business for the next five years or more...

I define a trend as a lasting change in the direction of a technology or market. Webster’s dictionary says, among other things, that it’s defined as “ a line of development.” A fad, on the other hand, is defined by Webster as “a practice or interest followed for a time with exaggerated zeal.”

This led me to consider a “trend or fad” example in our industry: the line array. It’s true that these improved tools have taken the market by storm. But if you make all of your purchasing decisions by listening to hype alone, you’d replace all of your gear on a yearly basis. And how can you possibly afford that?

Clearly, not all new products warrant the investment necessary to join your inventory. Before jumping on any new technology or product, you need to make sure it will deliver on its claims, and further, will deliver a positive return for your dollar.

Loudspeaker systems, consoles, amplifiers, signal processing and wireless systems are all just as prone to dramatic shifts in technology, creating pressure for rental company owners to make new equipment investments to “keep up”.

The Drive To Profit
So how does the average rental company decide which products are the right ones to add to inventory? Tough decisions, indeed. Make the right choices, and you possess the gear the clients want to rent at a price that will be profitable.

But make the wrong choices, and you end up with equipment that is difficult to rent. More energy will be required to get someone to use this gear, and at a lower price (and therefore margin).

You might even be forced to “sweeten the deal” to the point that any hint of profitability goes right out the door. Thus making the right long-term equipment investments is key—perhaps the biggest key—to solid, long-term profitability.

A vital factor in play is the alliances that are built with manufacturers as a sound company grows and matures. We all know that having the right equipment is one thing, but making sure that the company who made it is around for the long haul is equally important.

Fad products that come from fad companies can be attractive in the early stages; but if the manufacturer is not around to support it, it can become expensive and even impossible to keep the equipment in service.

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