How to Use This Report

I N T R O D U C T I O N

A B O U T T H I S R E P O R T

About this Report

This year’s AED Cost of Doing Business Report (based on 2021 operations) is designed to provide easy-tounderstand guidelines for identifying business performance improvement opportunities.

The AED Cost of Doing Business Survey was prepared by Industry Insights, Inc. of Columbus, Ohio, while working closely with AED staff in the design of the study. Confidential survey forms were made available to AED members in early 2022. Respondents were able to submit their survey forms through an online questionnaire or through a Microsoft Excel version of the survey.

This report includes comparative financial ratios and operations data segmented by sales volume, line of business, region (based on climate), rental emphasis, and a special grouping of “Best in Class” distributors, based on return on assets performance.

A valuable feature of the study is that all participating companies receive a confidential Company Performance Report (CPR) and access to personalized and interactive tools that are available through the AED research portal (www.AEDresearch.com). The portal provides the ability to compare individual results against the benchmarks of close peers in the industry.

The CPR displays each distributor’s own ratios and data computed in a manner consistent with those appearing in the full report, and the results are displayed alongside the appropriate industry comparatives (samples on the next page). As shown on any given line of the Company Performance Report, a company’s own data are included along with reported norms for all respondents and for companies of similar sales volumes, line of business, and region. Thus, the individual owner/manager is provided invaluable information without needing to spend time and effort performing the calculations manually. In addition, these highly confidential reports contain a qualitative assessment of a company's situation.

In addition to receiving access to the Company Performance Report, participants also receive access to various online reporting tools including an interactive “Searchable Results” program. The Searchable Results application provides more specific information than any single report could reasonably provide. Using the program, users are able to create their own data cuts to create benchmarks that most closely match their organizations. For example, a distributor could create a data cut based on a specific revenue size range and region, whereas the report only provides single-level cuts (e.g., revenue size range or region). The Searchable Results program and other interactive data comparison tools are housed in the participants’ online portal.

S A M P L E C O M P A N Y P E R F O R M A N C E R E P O R T

Sample Company Performance Report

The images on this page provide a sample pages that are included in each participant’s Company Performance Reports (CPR). The actual CPR that participants receive contains pages of information about their organization, compared against other similar companies and formatted as the pages below.

Y O U R D A T A C O M P A R E D T O T H E A P P R O P R I A T E I N D U S T R Y N O R M S

A “ R E P O R T C A R D ” E V A L U A T I O N O F Y O U R O W N F I R M ’ S P E R F O R M A N C E

H O W T O U S E T H I S R E P O R T

How to Use this Report

The AED Cost of Doing Business Report is designed to assist AED Distributors with evaluating their own performances relative to that of similar companies in order to identify improvement opportunities. The statistics in this report represent broad performance “yardsticks” against which a company's performance can be measured.

Using the information, industry members can compare their own company’s financial performance statistics against: AED dealers as a whole, companies of a comparable sales volume, companies within a similar line of business, companies operating in a particular region, companies of a similar rental emphasis, and a special grouping of “Best in Class” respondents, based on return on assets performance. Spotting significant differences between your own company’s performance and the comparable aggregates can be the first step toward improving performance. Please keep in mind:

1. A deviation between your company’s figures (for any performance measure) and numbers in the report is not necessarily good or bad. It merely indicates additional analysis may be required. As a general rule: the larger the difference - the greater the need for further investigation. 2. In situations where large deviations are found to exist, it may be helpful to go back and review - or calculate - the same performance measure over the past several years to identify any trends that may exist.

3. The information in this report should be used as a tool for informed decision making rather than absolute standards. Since companies differ as to their sales/customer emphases, location, size, and other factors, any two companies can be successful yet have very different experiences with regard to certain performance measures.

HOW THE DATA ARE ORGANIZED

The tables in this report are organized to promote analysis of the key financial performance metrics from various perspectives. The data have been aggregated based on significant respondent characteristics, such as sales volume, business line, region, etc.

The specific data aggregates examined for this study include: ✓ All Dealers ✓ Best in Class (top 25%, based on ROA) ✓ Distributors by Net Revenue: o Under $25 Million o $25-$50 Million o $51-$100 Million o $101-$200 Million o Over $200 Million ✓ Distributors by Line of Business (defined as 50% or more of sales from the line business) o Equipment Under 100 HP o Equipment Over 100 HP o Specialized Business¹ ✓ Equipment under 100 HP by Net Revenue o Under $75 Million o $75 Million and Over ✓ Equipment Over 100 HP by Sales Volume o Under $50 Million o $50-$125 Million o $125 Million and Over ✓ Region o Short Season o Moderate Season o Long Season ✓ Rental Emphasis o No Rent-to-Rent Revenue o Low Rent-to-Rent Revenue o Moderate Rent-to-Rent Revenue o High Rent-to-Rent Revenue

¹Due to an insufficient sample of reporting distributors, the Specialized Business aggregation has been excluded from this report.