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    State of the Industry 2009: Tent rental

    Tents | March 1, 2009 | By:

    Challenge, opportunity and growth: Our market forecast for tent renters

    In 2008, tent manufacturers, who produce and sell tents to tent rental companies in the U.S. and Canada, consumed 24.3 million square yards of fabric, a 1 percent increase from 2007. For 2009, growth in total fabric consumed will probably be flat, or even show a small decrease, staying at a consumption of about 24 million square yards. The most popular fabrics used for rental tents are vinyl-laminated polyester (82 percent) and vinyl-coated polyester (4 percent).

    Top challenges in 2009

    In January 2009, Special Events magazine’s annual event industry forecast reported that event professionals (both in-house and independent) said that the poor economy worldwide will be their greatest challenge in 2009, listed by 78 percent of in-house professionals and 88 percent of independents. This contrasts sharply with their sentiments on the economy in 2008, when only 31 percent of in-house professionals and 57 percent of independents cited the economy as a major challenge.

    Despite their concerns about the sour economy as a whole, some event professionals are fairly upbeat about their event rental business prognosis for 2009. Twenty percent of in-house professionals and 33 percent of independent event professionals surveyed said that they will stage more events in 2009 than they did in 2008. (Last year, 49 percent of in-house professionals and 59 percent of independents indicated that they’d stage more events in 2008 than in 2007.)

    Reduced budgets were reported as the second-greatest challenge of 2009 by 64 percent of in-house professionals and 81 percent of independent event professionals. This situation is exacerbated by the higher prices of raw materials in 2008, which are likely to continue at least through the first half of 2009. Another challenge that seems to linger year after year for event rental professionals is the continued shortage of labor and skilled labor to make these events happen safely and on time.

    Trends in tent rental

    An expanding and aging population is helping to drive the tent rental business. A large percentage of tent rental business comes from people who are 40–70 years old, because they have many life events to celebrate, including children’s weddings, 50th birthdays, retirements and anniversaries. Approximately 45 percent of the U.S. population, 136.5 million people, were 40 years of age or older as of 2007.

    Future tent rentals will require faster installation, and will be used for longer periods of time, for applications such as warehouses and retail space.

    Tent manufacturers are trying to develop lighter frames to simplify set-up and help alleviate the rising cost of fuel for transporting tents to customers.

    “Green” events continue to increase in popularity. Tent manufacturers and tent renters are committing to setting goals toward achieving sustainability, highlighting recycling and energy efficiency. One major party rental firm has formalized its green event initiatives, to reduce pollution and waste and develop best practices for clients. Key initiatives include:

    • developing the best in industry “green events” for clients;
    • reducing, reusing and recycling all possible materials to reduce waste;
    • reducing energy, fuel, natural gas and water consumption;
    • developing a sustainable purchasing program; and
    • ensuring proper air quality and hazardous waste disposal at all facilities.

    Some tent-rental companies are sourcing tents through inexpensive imports, especially from China.

    Consolidation is still changing the tent-rental landscape. Companies specializing in tenting are looking to expand their products and services to become full-service rental providers. For example, Classic Party Rentals (Los Angeles, Calif.) still maintains a growth-through-acquisition strategy; in 2008, the company expanded its operations into Phoenix and New York.

    Outlook > Tent rental

    Looking at 2009, the biggest unknown is still the economic environment. There is likely to be a reduction in the number of large and small events throughout the first half of the year. People will still want to hold events, but they will try to save costs wherever they can and avoid extravagant expenditures. A rented tent, of course, can offer significant cost savings over a hotel or other facility rental.

    Not all tent rental businesses are experiencing a significant downturn in business. Party events held steady in 2008 but may slow slightly in 2009, while corporate events (especially trade shows) are down. Special Events magazine reports that many corporations are pulling back on their events simply to avoid appearing extravagant. Companies are rethinking their usual activities after firms such as insurance giant AIG received so much negative press about sending people on incentive trips, then needed a financial bailout from the U.S. government to stave off a catastrophic bankruptcy

    Parties and events are one of the fastest-growing segments in the rental industry today. According to the American Rental Association’s “State of the Equipment Rental Industry Report,” over the past few years, tent rentals remain a leading revenue generator for event professionals. One nationally operated U.S. tent rental company reports that it is doing fairly well, and feels that the party and event rental industry is not that much affected by the economy. Their market niche includes many events that are grand openings or annual events—from golf tournaments to graduations—and many life events like weddings. The company doesn’t do a lot of corporate events and trade shows. In fact, in the Special Events Forecast for 2009, many of the magazine’s advisory board members noted that the mood in today’s event rental business is like that following the September 11, 2001, terrorist attacks, when many independent event professionals, who formerly catered only to corporate clients, found they had to shift to party events such as anniversaries and weddings to stay afloat.

    Some established event rental firms that serve the corporate market report that they are not really feeling a credit crunch, but they do see its impact affecting them for the first half of 2009. This is a very fragmented, competitive market, with thousands of companies trying to serve the event market with rental tents and tent-related equipment. The companies that have been and still are struggling will have a difficult time in terms of sales and profitability in 2009. Being flexible in serving different markets and different kinds of events will be key for growth and profitability in 2009 and beyond.

    Jeff Rasmussen is a market research manager at the Industrial Fabrics Association International, at +1 651 225 6967, e-mail

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