The History of Enterprise Rent-A-Car

When most people think of car rentals firms, the names of Hertz and Avis usually comes to mind. But in the last few years, Enterprise Rent-A-Car has overtaken both these industry giants and today it stands as both the largest and the most profitable business in the car rental industry. In 2001 ,for instance the firm had sales in excess of $6. 3 ban and employed over 50,000 people. Jack Taylor started Enterprise in SST Louis in 1957. Taylor had a unique strategy in mind for Enterprise and that strategy had a key role in the initial success of the firm.

Most AR rental firms like Avis base most of their locations in or near airports ,train stations and other transportation hubs. These firms see their customers as business travelers and people who fly for a vacation and then need transportation at the end of tiger flight. Enterprise went after a different customer base. It sought to rent cars to individuals whose own cars are being repaired or who are taking a driving vacation. The firm got its start by working with insurance companies. A standard feature in many automobile insurance policies is the provision of a rental car when one’s arsenal car has been in an accident or has been stolen.

Firms like Hertz and Avis charge a relatively high daily rates because their customers need the convenience of being ear the airport or have their expenses paid by their employers. These rates are higher than insurance companies are willing to pay, so customers who use these firms end up paying part of the rental bills themselves. In addition their locations are also often inconvenient for people seeking a replacement car when theirs is in the shop. Enterprise located their stores in downtown and suburban areas where local students actually live.

The firm also provides local pick up and delivery service in most areas. Let also negotiates exclusive contract arrangements with local insurance agents. T hey get the agents referral business while guaranteeing lower rates that are more in line with what the insurance covers. In recent years Enterprise has started to expand its market base by pursuing a two- pronged growth strategy. The firm has started opening airport location to compete with the existing firms more directly. The target still remains the occasional renter ether than the frequent business traveler.

The firm has also begun to expand into international markets and has rental offices today, in the I-J, Ireland and Germany. Another key to Enterprise’s success has been its HER strategy. The firm carefully targets another kind of individual to hire; preferably new employee is a college graduate from the bottom half of the graduating class and preferably the one who was an athlete or who was otherwise actively involved in campus social activities. The rationale for this unusual academic standard is actually quite simple.

Enterprise angers do not believe that especially high levels of achievements are necessary to perform well in the car rental industry, but having a college degree never unless demonstrates intelligence and motivation. In addition since interpersonal relations are important to its business. Enterprise wants people who are social directors or high ranking officers of social organizations such a s fraternities or sororities. Athletes are also desirable because of their competitiveness. Once hired, new employees at Enterprise are often shocked at the performance expectations placed on them by the firm.

They generally work long hours that are grueling for a relatively low pay. And all Enterprise managers are expected to Jump in and help wash or vacuum cars when a rental agency gets backed up. All Enterprise managers must wear coordinated dress shirts and ties and can have facial hair only when medically necessary. Women must wear skirts no shorter than 2 inches above their knees or creased pants. So what are the incentives for working at Enterprise? For one thing it is an unfortunate fact of life that college graduates with low grades often struggle to find ark.

Thus ,a Job at Enterprise is still better than no Job at all. The firm does not hire outsiders?every position if filled by promoting from within. Thus Enterprise employees know that if they work hard and do their best they may well succeed in moving higher up the corporate ladder at a growing and successful firm.

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