Feature, Operations, Sales & Marketing, V5I4

Shed Financing Consolidation

According to Investopedia.com, companies consolidate with other businesses for several reasons. Among them are to stimulate growth, gain an edge on their competition, increase market share, or impact supply chains.

It’s no different when a player in the shed-building industry consolidates with a competitor. And, according to Phil Falls, CEO and founder of Greenville, South Carolina-based RTO National, his company is on the move.

As one of North America’s largest providers of consumer lease purchase contracts (also known as rent-to-own, or RTO) and installment contract agreements for the backyard service industry, RTO National has increased its market share by two recent acquisitions, said Falls.


There is no question the sales and acquisitions team at RTO National have worked overtime in 2019, and their efforts have paid off.

The evidence are the two sizable acquisitions RTO National made this past spring. One is the purchase of the finance portfolio of BLI Rentals and the other is the procurement of the lease accounts for US Credit’s backyard products.      

While he would not disclose the purchase price paid for the portfolios, Falls describes the acquisitions as “two pretty large transactions, so I am proud of my team.”

Falls describes the transactions, which finalized within one week of each other, as a strong indicator of “where the industry is going.” 

In fact, because BLI’s finance portfolio was second in size only to RTO’s predominant market share, that purchase is all the more meaningful, says Falls. 

“BLI was the only other company doing both consumer finance and RTO, and they decided to exit the finance business,” he shares. “We were able to buy their finance accounts and it worked out well for us.”

Brian Haag, COO of BLI Rentals, isn’t surprised the shed building and financing industries are evolving. 

“As the shed RTO industry matures, it is natural for consolidation of companies/portfolios to be happening,” he writes in an email. 

“At BLI Rentals, we feel consolidations will continue in the future. It makes sense for the companies who have not been progressive with their systems, including legal/compliance requirements and customer service, to look to sell. 

“Many potential sellers need to be aware of the risk they carry, including non-performance, and thus be realistic about the value of their company/ portfolio.”

The shed financing industry is “moving toward needing to provide financial and RTO solutions,” Falls points out. 

This purchase allows dealers to contract with customers with better credit because they are pre-screened before the online transaction is finalized. 

Time was that a customer without good credit had to either buy a shed outright or “be pushed” into an RTO agreement, says Falls. 

However, its increased reliance on technology is allowing RTO National to offer financing for purchases, and that’s a game changer. Customers undergo credit checks just as they would if a bank financed the shed purchase.

“We are the only one who can do both,” says Falls of his company’s ability to offer RTO agreements or financing for shed purchases. 

RTO National already owned and managed a large cache of consumer finance accounts, so the two purchases increase its market share considerably.

RTO National’s procurement of US Credit’s backyard products lease portfolio was quite strategic. Although RTO National has been active in the Florida market for at least a decade, acquiring US Credit’s lease portfolio has given it “deeper penetration” in the Sunshine State, Falls shares. 

The expansion allows RTO National to expand relationships it had already established in Florida, he adds.

The US Credit purchase “provides us with more scale, which lets us continue to invest in providing additional services to our dealers and manufacturers,” says Falls.


It’s no surprise the advent of technology is having an impact on the shed-building and financing industries. 

Because of that, Falls foresees the need for increased investment in technology services it provides to the dealers and manufacturers whose loans his company finances. 

One example is RTO National’s ability to finance shed purchases or rentals online. 

Another is the agreement RTO National entered into with IdeaRoom, a 3D technology firm, earlier in 2019. The Boise, Idaho-based software company has developed 3D technology allowing customers to design and purchase a backyard shed from a manufacturer. 

Often, when a customer creates their shed design using the advanced technology, they add on additional items, such as shutters or window boxes to their purchase. That, of course, means a larger profit margin for the manufacturer.

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