THE CHANGING FACE OF RELOCATION: A metamorphosis within the moving industry
By Eric Anders • Aug 9th, 2009 • Category: THE CHANGING FACE OF RELOCATION, TRENDS IN RELOCATION
A survey of 3000 people conducted by outplacement firm Challenger, Gray & Christmas in July reported that more than 18 percent of job seekers who found work in the second quarter relocated in order to take their new positions. That compares with 14.3 percent in the first quarter and 11.4 percent during the same period a year-ago. What’s not discussed is that many of these fortunate souls were renters with smaller households or unemployed workers with more restrictive moving budgets.
Recent PR announcements issued by several major brands suggest that the typical business cycle, processes, products and services normally used by relocation providers is changing. As a result, consumers and corporate customers will have a few more options to consider when planning a domestic or international move going into the non-peak fall and winter seasons.
The buzz within the industry suggests that this unusual partnering was in response to an earlier announcement by Atlas World Group, the parent of Atlas Van Lines, that the global relocation service provider had purchased Smart Move, Inc., a smaller player in the do-it yourself portable storage market. The trend opens the possibility of future pairings of other full- and self-service moving and storage options.
Then publicly traded AMERCO (Nasdaq: UHAL), the parent of U-Haul International, Inc. , one of North America's largest "do-it-yourself" moving and storage operators, reported its net first quarter earnings were down approximately 26% compared to the same period last year.
The company’s self-moving equipment rental revenue for the first quarter dropped by $17.1 million compared with the first quarter last year. Fortunately, this decline was partially offset by an increase in local rental activity. The press release also noted that self-storage revenues also decreased but the occupancy trend began to improve during the quarter.
That’s probably because of some creative marketing like U-Haul’s ‘Take a Box/Leave a Box Program’ ; and their 30-day free-storage offer before or after a one-way move that the company makes available to budget conscious customers at their locations throughout the U.S. and Canada. Meanwhile competitor Budget Truck Rental LLC offers seniors 20% off of equipment rentals. Some locations even throw in a GPS for the guy who won't ask for directions.
Full service and self service storage operators, moving companies, and relocation service providers all bristle at the revenue loss that these types of popular “freebie giveaways” are costing them even as they struggle to develop their own programs to compete in the growing do-it-yourself marketplace.
PODS, for instance, currently offers their forth month of storage for free, while Smart Move promises to provide a box kit at no charge with every residential and commercial self service move.
Several forward thinking and innovative movers have had their “Green” community box exchanges operating for some time. Some van line affiliates allow their sales people to offer limited free material and storage incentives to 'well qualified' customers with larger homes.
For years, household goods movers, relocation brokers and mobility companies have offered attractive pricing concessions through contracts with high volume affiliate programs. These programs allowed dues paying members to receive special discounts and services such as additional reductions on transportation, material, or storage-in-transit expenses, or incentives offering up to $100,000 of valuation coverage or preferential move management services at no additional cost. .
Organizations like educational and alumni institutions, fraternal societies, white and blue collar unions, and ‘member only’ auto and big box clubs negotiated these ‘freebies’ from participating vendors to justify their membership cost.
The rising tide of unemployment combined with the loss of consumer confidence caused by the recent collapse of the financial and real estate markets, however, has forced many potential customers to tighten their belts and cease their participation in these types of ‘frivolous’ affiliate programs.
In response, some product vendors and service suppliers now offer variations of the same money saving incentives directly to the public so as not to miss possible new sales opportunities in this weak economy. As a result, there are some very attractive deals being offered this fall and winter if you’re planning to relocate. Just be prepared to shop around, get a written estimate, and then read each contract and research every company you’re considering to ensure yourself they’re reputable. Remember don’t look for the lowest price – find the best value.
What’s the biggest challenge you have planning your next move?
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