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In-depth SWOT Analysis of Enterprise Rent-A-Car – An American Car Rental Agency

by | Case Studies | 0 comments

In the previous articles, we have mentioned the SWOT Analysis of Suzuki, one of the world’s largest mass car manufacturers. This time, we will take an avenue on SWOT Analysis of Enterprise.

Enterprise Rent-A-Car is a company that knows firsthand how to react to a customers’ demand can create astounding progression and growth. Many of the most successful and utilized services the company provides were developed because Enterprise management had the forethought to listen and respond to its customers. Enterprise is in a great position regarding their incomes and behaviour due to their customer orientation and focus. Enterprise, the holding company, is the nation’s largest rental car company.

Enterprise Rent-A-Car has profited from its marketing activities as a result of its market position. Marketing evolves in response to changing societal preferences. Attend our Free MasterClass on Digital Marketing, taught by IIDE’s Founder and CEO, Karan Shah, if you want to stay current with today’s effective marketing. 

Let’s start with Enterprise Rent-A-Car’ history, founding, finances, services, and market competitors in this SWOT Analysis of Enterprise Rent-A-Car.

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About Enterprise Rent-A-Car

SWOT Analysis of Enterprise - The Founder of Enterprise
(The Founder of Enterprise Rent-A-Car, Source: IIDE Creator’s Room)

Enterprise Rent-A-Car service began in 1957 by Jack Taylor in Missouri with only seven rental cars. The industry increased to be the most extensive car rental service in the U.S. with over 68,000 employees in 2012. The company has over 6000 locations crossing the U.S, Canada, Germany, Ireland, and the UK. Enterprise Rent-A-Car holds a customer service-based business.

In 1989, Taylor developed the company’s name from “Enterprise” to “Enterprise Rent-A-Car”. At this point, there have been over 500 Enterprise Rent-A-Car locations and over 50,000 rental cars. 

In 1993, Enterprise opened its first foreign office in Windsor, Canada. In 1995, Enterprise Rent-A-Car inaugurated its first airport office in Denver. By this time, Enterprise Rent-A-Car created two billion dollars in yearly income. In 2004, each Enterprise location was about 15 miles apart from one another for 90% of the U.S. At this time, Enterprise Rent-A-Car was making over seven billion dollars in annual revenue.

In 2007, Enterprise published its environmental goals and how they would affect business. In 2012, Enterprise designed the Enterprise CarShare network to allow customers to rent cars through automated systems. As of 2012, the company generated 14 billion dollars in annual revenue.

Quick Stats on Enterprise Rent-A-Car
Founder Chrissy Taylor
Year Founded 1957
Origin St. Louis, Missouri, United States
No. of Employees 80,000+
Company Type Private
Market Cap N/A
Annual Revenue $ 23.9 Billion (2020)
Net Income/ Profit N/A

 

SWOT Analysis of Enterprise - Enterprise


Services by Enterprise Rent-A-Car

  • Alamo Rent-A-Car
  • Enterprise Car Club
  • Enterprise Car Sales
  • Enterprise Rent-A-Car
  • National Car Rental


Competitors of Enterprise Rent-A-Car

  • Hertz
  • Avis Rental Car
  • Avis Budget group

Now that we got to know about the company’s function and their vast business globally, now let’s dig into the SWOT analysis of Enterprise Rent-A-Car.


SWOT Analysis of Enterprise Rent-A-Car

SWOT analysis is a planning technique to help an organization identify its strengths, weaknesses, opportunities, and threats. SWOT Analysis of Enterprise will help the company to assess the results to decide if they can use their strength as an advantage to increase the growth of the company or not. The weakness and threats of the company also need to be addressed before making any changes to their existing services.

To better understand the SWOT Analysis of Enterprise Rent-A-Car, refer to the infographics below:

SWOT Analysis of Enterprise - SWOT Infographics of Enterprise

So let us first start by looking at the strengths of Enterprise Rent-A-Car from the SWOT analysis of Enterprise Rent-A-Car.

Strengths of Enterprise Rent-A-Car

  • Greater Relationship with Existing Suppliers: Enterprise car rental has a strong relationship with its suppliers and other members. the organization can increase its services by the skills of its suppliers and supply chain partners.
  • Domestic Market: The domestic market in which Enterprise is operating is both a source of strength and a barrier to the growth of innovation. Enterprise can easily grow the market without much innovation but it will require the furthermost investment into research and development to enter the international market.
  • High Margins: Enterprise charges a premium compared to its competitors, Enterprise resources are not only for the competitive pressures but also to invest in research and development.
  • Strong Brand Equity and Brand Awareness: Enterprise is the most recognized brand in the domestic market. Brand recognition plays a significant role in attracting new customers looking for solutions in Customer service, Growth strategy, Leadership development, Marketing, Motivating people, etc.
  • High Market Record: Enterprise cars have a highly successful record of both launching new products in the domestic market and also in various markets based on the insights from local consumers. Enterprise Car has inquired about various concepts in different markets and reached successful organizational development solutions.


Weaknesses of Enterprise Rent-A-Car

  • Inventory Management: Enterprise is not efficiently maintaining the inventory and cash cycle. There is a huge scope of improvement in inventory management.
  • Project Management: Project administration is too focused on internal delivery rather than considering all the interests of external stakeholders and supervising poor public relations and customer backlash.
  • Low Return on Investment: Enterprise has a stable balance sheet, one metric that needs reflection is the return on invested capital. An organizational form in which Enterprise works in the most stable measure of profitability is the return on invested capital rather than one preferred by financial analysts such as return on equity and return on assets.
  • Consumer Dissatisfaction: The demand for services has not gone down but there is a heated sense of dissatisfaction among the customers of Enterprise. It is shown in the reviews of multiple online platforms. Enterprise should concentrate on areas where it can improve the customer purchase and post-purchase experience.
  • Implementation of Technology in Processes: Enterprise has combined technology in the backend processes but has still not been able to secure the power of technology in the front-end processes.
  • Company Culture: It seems that the organizational culture of Enterprise is still ruled by turf wars within various divisions, leading to supervisors keeping information close to their chests. This can lead to serious roadblocks in future growth as information in silos can result in missed opportunities in the marketplace.


Opportunities for Enterprise Rent-A-Car

  • Diminishing Cost of Market Entry and Marketing into International Markets: Globalization along with a growth in digital marketing and social media has considerably decreased the risks of market entry and marketing in the international market.
  • E-Business and Social Media Oriented Business Models: The E-business model can help Enterprise to tie up with regional suppliers and logistics providers in the international market. Social media growth can help Enterprise to decrease the cost of entering a new demand and reaching customers at a significantly lower purchasing budget. It can also lead to crowdsourcing various services and consumer-oriented marketing based on the data and purchase behaviour.

Social media marketing and e-commerce are one of the major parts of digital marketing. It is important to learn these digital marketing skills for effective cost-cutting and reaching potential buyers. Students and freshers who want to start their fresh set-up with zero investment are also learning these skills.  

  • Managing Rule and Business Environment: Enterprise operates in an environment where it faces numerous regulations and government conditions. The firm needs to cross over the environment by building strong relationships with political parties.
  • Building Standardization: Enterprise can leverage this trend to decrease the number of contributions in the market and focus the marketing efforts on only the most successful products.
  • Developing Technology Landscape: Machine learning and artificial intelligence increase the transformation of the technology landscape that Enterprise operates in. Enterprise can use these to develop efficiencies, lower costs, and change the process.
  • Increase in Consumer Disposable Income: Enterprise can use the increasing disposable income to build a new business model where customers start paying progressively for using its services. 


Threats to Enterprise Rent-A-Car

  • Controversies with Safety Measures: In the year 2006-08, Enterprise went through a controversy in which the company purchased Chevrolet Impalas without side-curtain airbags to save the company’s $11.5 Billion. The controversy started when the cars were released from their rental fleet with claims that side-curtain airbags were included. Such types of claims if continued in future will affect the Enterprise very badly.  
  • Government Laws & Bureaucracy: Enterprise should keep a close eye on the fast-changing government regulations under the increasing pressure from demonstration and non-government organizations, especially regarding environmental and labour safety aspects.
  • Credit Binge Post-2008 Recession: Enterprise should focus on reducing its dependency on money to grow. The party has endured for more than a decade and rollback from the Fed can result in huge interest costs for Enterprise.
  • Developing Bargaining Power of Buyers: Over the years the bargaining power of customers of Enterprise has increased significantly which is putting down pressure on prices.
  • US-China Trade Relations: Enterprise Car has adjusted to China for its next stage of growth. But there is rising pressure between US-China trade relations and it can lead to protectionism, more conflict into international trade, increasing costs both in terms of labour cost and cost of doing business.
  • Compressing the Middle Class in Developed and Developing World: The growing disparity is one of the biggest threats to not only globalization but also to capitalism. Enterprise first hand testified the impact of it where it has seen lower demand of its products from middle-class customers in the US and EU market.

This ends our comprehensive SWOT analysis of Enterprise Rent-A-Car. Let us conclude our learning below.

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To Conclude

Enterprise Rent-A-Car is to implement incentives for customers to consider WeCar. The car division of Enterprise Rent-A-Car prefers using fuel-efficient vehicles and carpooling to get from place to place.

Implementing incentives would ultimately fall in line with Enterprise’s environmental plans. It would also be useful to expand WeCar to Ireland, Germany, and Canada since the service is currently offered in only the U.S and the UK. As said in the opportunities and threats section, Enterprise Rent-A-Car should also bring Flex-E-Rent to the USA for customers involved in long-term car rentals. 

Enterprise trades its automated rental management system to competitors, building an industry standard for car rental management systems. Finally, Enterprise must keep their car record as new as their competitors to keep one customer from using another service.

In today’s world, every business has its presence online. With increasing competition, it is very important to make your mark and defend yourself in the market. So, being well versed in this field is a must for marketing enthusiasts. If you are interested in learning more about digital marketing and want to upskill then don’t hesitate to check out our IIDE’s 3 Month Advanced Online Digital Marketing Course.  

We hope this blog on the SWOT analysis of Enterprise Rent-A-Car has given you a good insight into the company’s strengths, weaknesses, opportunities and threats.

If you enjoy in-depth company research just like the SWOT analysis of Enterprise Rent-A-Car, check out our IIDE Knowledge portal for more fascinating case studies.

Thank you for taking the time to read this, and do share your thoughts on this case study of the SWOT analysis of Enterprise Rent-A-Car in the comments section below.

Lead Trainer & Head of Learning & Development at IIDE

Leads the Learning & Development segment at IIDE. He is a Content Marketing Expert and has trained 6000+ students and working professionals on various topics of Digital Marketing. He has been a guest speaker at prominent colleges in India including IIMs......[Read full bio]

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