Leasing and Rental in T&M

There are alternatives to buying test instruments.


Buying a high-end oscilloscope or a brand-new logic analyzer may be a tall order financially for small companies. In such cases, leasing or renting an expensive test instrument can be an affordable alternative.

Having reliable test and measurement equipment is vital to product development in electronics. National Instruments has built a billion-dollar business on offering instrument hardware and software based around LabVIEW, NI’s software-centric platform.

One of the biggest companies in the test and measurement equipment rental and leasing market is Electro Rent Corporation, which was acquired last year for about $362 million by Los Angeles-based Platinum Equity. Electro Rent went on to purchase Microlease plc from Lloyds Development Capital, completing the transaction in February; financial terms weren’t disclosed.

Electro Rent also sells new and used electronic T&M instruments from the leading manufacturers, such as Keysight Technologies, Anritsu, Rohde & Schwarz, and Tektronix. In addition, it has a Data Products division, offering PCs from Apple, Dell, HP, IBM, and Toshiba.

Electro Rent’s primary competitors are Continental Resources (not to be confused with the oil and gas company of the same name), McGrath RentCorp, and TestEquity. It also competes with banks on leasing and renting T&M equipment. Anritsu, Keysight, Rohde & Schwarz, and Tek compete with Electro Rent on selling new instruments.

The North American market for T&M equipment is worth more than $300 million a year in instrument leasing and rental.

Electro Rent’s rental and lease revenue was on the wane up to the Platinum Equity acquisition, declining from $120.6 million in fiscal 2014 (ending on May 31) to $111.3 million in fiscal 2015 and to $105.85 million in fiscal 2016. The company’s T&M sales revenue fluctuated up and down over those three years, while the DP division steadily grew in that period.

Some of Electro Rent’s biggest rivals in the past, namely Leasametric and United States Instrument Rental (USIR), are greatly reduced in size or out of business.

Making money off leasing or renting out test and measurement instruments is a tough business. Companies usually make a profit when they resell the equipment on the open market.

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