Do I need much equipment to start a rental business?
Don’t overspend on equipment at the start: buy your minimum viable inventory based on your market research. Once you get started, buy more of the equipment that is most popular and lucrative.
Are you thinking about starting a rental business? Get off to a great start with these tips!
It doesn’t matter whether you want to rent out camera equipment, bikes, luxury cars, party supplies, … Our advice will help you make your rental business a success.
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Starting the exact same business in two locations mere miles apart can lead to radically different results. A bike rental downtown will have different customers than one by the beach, and they will have different needs. So before you get started make sure that you know what your customers are looking for!
The best way to do this is quite simple – talk to them. If you want to rent out construction equipment, talk to local construction companies. Kayaks and canoes, talk to tourists, etc. Some questions you can ask:
Professional market research can quickly become expensive, but you can do a lot yourself!
By knowing your customers and what they are looking for, you can make smarter decisions about the equipment you buy. Avoid idle inventory at all costs – it only takes up space and money that you could use to grow your business!
Don’t overspend on equipment at the start: buy your minimum viable inventory based on your market research. Once you get started, buy more of the equipment that is most popular and lucrative.
It is cheaper and easier to buy more equipment later than to get rid of excess unwanted equipment. To track what you have and decide what to buy, it's easier to use asset management software to stay ahead.
Unless you’re starting a rental business because you won the lottery and got bored, you’ll want to make the most of every cent or penny you spend.
Your equipment is likely to be one of your biggest investments, so make sure you invest your money wisely. Instead of blowing all of your money on the newest and best equipment you can find, consider your alternatives.
Your business depends on your equipment – no equipment, no rentals!
That is why it is so important that you take good care of your equipment inventory:
The good news first: you don’t need to invest a massive amount of time, money, and effort into creating your website.
It is vital, however, that you have an online presence and that when people visit your site, you create a good impression. The first thing your potential customers will do is search for information online. That is why you need:
Looking for more information about setting up your own website? This article provides a more comprehensive overview.
Creating a presence on social media is important as well. If you rent to other businesses, they are less likely to check Facebook for options, but they might look on LinkedIn. Here is some advice on using social media for your small business.
Even with social media, your own website is your most important online property – it is your home online, that is fully under your control. So make sure it reflects well on you!
Start by asking yourself, ‘What other products or services are my customers looking for?’
If you are starting a bike rental shop, your customers might also need:
Contact these companies or organizations and ask them if they would be interested in a referral partnership: if someone asks for a bike rental, they refer them to you. And if someone asks you for a place to stay, eat, or visit, … you refer them to your partners.
By referring customers to each other, you create a win-win-win situation.
The referrals you make reflect back on you – so only make recommendations that you feel confident about! The last thing you want is customers complaining about the advice you gave them.
This advice is valid for other industries as well – e.g. if you are starting an AV or party rental business, your customers probably need catering and a venue.
As a small business owner, you need to take care of more than just renting equipment. Accounting, communication with (potential) customers, managing employees, …
As luck would have it, we have created a list of business applications that we recommend.
Every application on this list is designed to help you manage your small business!
Not the sexiest of topics, but an important one! The work you need to do depends on where you are based (here is an overview for starting a new business in the US)
Besides the formalities of starting any business, a rental business has extra insurance liabilities. Your entire business depends on non-employees interacting with your equipment.
So while you want to make sure you have good insurance for your equipment, your customers are your biggest risk. Even with no-liability waivers, make sure you have the right insurance. You don’t want one big hospital bill to jeopardize your entire business!
Rentals are repetitive – your customers only rent your equipment for a period of time, so if they need it again in the future, they have to rent it again.
Make sure that when they rent again, they come to you!
At the same time, don’t neglect general customer service.
Do you think customers enjoy arguing with you? And do you enjoy arguing with them?
The answer to the first question is ‘no’, and ‘no’ should be your answer for the second question as well. But what can you do to avoid arguments?
Make sure you and your customers are on the same page. Sign a check-out agreement!
Clearly communicate the answers to these questions upfront to avoid confusion and conflict later on.
Have these terms in writing as well, signed by both you and the customer. Be thorough & complete, and don’t ‘hide’ anything in the small print. If you make something hard to read, don’t be surprised if your customers don’t read it!
If you’ve followed all of this advice, you should have a pretty good idea by now about what you should do to make your new rental business a stunning success.
But don’t just keep it in your head! Bring it together in a business plan for your rental business – a rental business plan.
A business plan is essential for the success of your business. Remember the old proverb – failing to plan is planning to fail.
So here is some advice from the US Small Business Administration on creating a business plan!
These are our tips for starting your own equipment rental business. We hope that this guide has been helpful to you.
Interested in our equipment management software? Start a free trial or book a demo.
Don’t overspend on equipment at the start: buy your minimum viable inventory based on your market research. Once you get started, buy more of the equipment that is most popular and lucrative.
Assure regular maintenance; Do prompt and thorough repairs, fix any issues quickly and thoroughly. Do cosmetic fixes- your equipment shouldn’t just work like new, it should look like new as well.
Create partnerships with locals or companies with which you can exchange referrals, help each-other out. Be good to your customers, meaning hassle-free with friendly service and don’t go after their money.