Have you ever been to the Malta Aquarium? Outside, there is an LED screen showing clips about the underwater world. As you go in, the sound system guides you around, and interactive tablets give information about the fish and mammals in the tanks. Other tablets are used by the waiters in the cafeteria to take orders – and then there is also the kitchen equipment itself. What do all of these things have in common?

They were all rented from GC Renting Malta Ltd, enabling the aquarium to invest its capital in the elaborate displays, rather than on equipment which would also weigh down its balance sheet.

GC Renting Malta was set up two years ago to operate the Grenke franchise. The Grenke Group was set up in 1978 in Germany, and has bought over €1.3 billion worth of equipment in 2014 alone, through its presence in 29 countries.

GC Renting’s managing director, Paolo Dellamano, was in Malta a decade ago on holiday and, as so many do, fell in love with the island. The long-term Grenke in Italy employee eventually found the perfect reason to return: he could see that the island’s service economy was thriving and the Grenke model would fit in perfectly.

Mr Dellamano invested in GC Renting, along with the Grenke Group, setting up offices in

Tagliaferro Centre in Sliema, and started to offer companies the opportunity to rent their equipment, whether start-ups wanting an all new set-up, established companies wanting to refurbish, or growing companies wanting to expand.

With the number of clients growing constantly, GC Renting is mulling the idea of specific packages for particular equipment

The model is very simple: the companies determine what they want and source the products. GC Renting then pays the reseller for the products – in full, within 24 hours – and rents the equipment to the client for a minimum of 15 months and a maximum of 60 months, “because by then the product is probably due for upgrade anyway”, Mr Dellamano said.

The model has obvious advantages for the client, who saves on the upfront capital expenditure, while still benefiting from service and maintenance agreements – and even the option of upgrading the equipment before the end of the rental term. The ‘cash’ payment made by GC Renting means they can often negotiate a good discount from the reseller. The quarterly rental instalments are also considered to be a ‘cost’ in accounting terms, and can lead to tax advantages.

The company is under no obligation to purchase the equipment at the end of the contract, in which case GC Renting can, when appropriate, use its international channels to find it a suitable second home, rather than just dumping it.

For GC Renting, the trick is to balance speed and service with risk – after all, it is basically shelling out up to €340,000. To ensure a low delinquency rate, it has a robust due diligence system, carrying out credit checks on the applicant. It also relies on relationships and networking, which is a given reality in Malta.

“Malta is very low risk. This is also part of your business culture,” he said.

The company is very proud of its response record, which is all based on speed.

“We understand that once companies have gone through the whole process of identifying their needs and going through the procurement process, they are anxious to get going as soon as possible. This is why we pride ourselves on being able to give a reply on equipment of up to €50,000 in just 20 minutes, and of over €50,000 in a few hours, certainly no more than 24 hours,” regional sales manager Massimo Pappalardo explained.

Start-ups are perhaps harder to assess – but then the value of the equipment is also usually much lower, so GC Renting does as much as it can within its comfort zone.

“The Grenke franchises overseas get hundreds of enquiries from start-ups that no one has ever heard of before. Here it is much easier as the people behind them often have a track record. And many start-ups represent or have a link with overseas companies so we can tap into the Grenke Group’s experience,” Mr Dellamano said.

The rental model differs from a bank loan in that the client does not need to provide any collateral – the equipment itself remains the property of GC Renting. And the negotiated interest rest is very competitive when compared to that offered by a bank.

GC Renting is constantly expanding the list of resellers in its client portfolio and has moved beyond IT into more and more sectors, from medical equipment for St James Hospital to kitchen equipment for Michael’s Restaurant in Valletta, from shop fittings and POS equipment for fashion retailer List Roma to IT systems for the Radisson Blu hotels. Some clients – like Alberta and Vivendo Group – are both resellers and clients.

Moreover, other big projects are financed for Vassallo Group and AX Holdings Ltd.

With the number of clients growing constantly, GC Renting is mulling the idea of specific packages for particular equipment.

“We have in mind a print plan package for photocopiers and printers, against one easy monthly rental for a set number of copies or prints,” Mr Dellamano said.

“Ten years ago, I had only a vague idea of how it would work out. Now, after just two years, we are already thinking about expanding. My instinct about Malta was right,” Mr Dellamano laughed.

www.grenke.com.mt