French renters should 'resist penalty clauses'

French rental companies may be enjoying improved market conditions but they need to be more professional with written contracts and add-on services such as equipment deliveries, said Hervé Rebello, director of DLR, the French rental and distributors association.

Rebello, speaking at the Rental Day conference at Intermat, said rental companies should not sign 100 page contracts without understanding the consequences; “We cannot accept signing a contract without understanding them…we have to be very professional.

“More and more clients are asking for financial penalties. ‘If your equipment stops operating for one hour…’ Stop. [You are] not a sub-contractor. In these new contracts we see penalty clauses, it is a practice coming from industry. We must strongly resist that kind of contract.”

He said that the French rental market continued to see erosion on prices, a trend that is not helped by offering free services such as equipment transport. “Since 2008 we have had a really big drop in the level of prices…we are losing about 2% each year. It’s a big, big challenge.”

Rebello said this problem was further exacerbated by long payment terms, or even non-payment; “We must stop delivering equipment without a purchase order…the consequence is that you will not be paid.”

He joked; “The national sport in France is not being on strike, it’s not paying.”

The Rental Day was organised by Intermat in partnership with DLR and the European Rental Association (ERA).