How to Start an Equipment Rental Business
How would you like to know that you can make money on the side or full-time by renting out some of the items in your possession? All you need to start an equipment rental business are useful items and a place to keep them; the rest will be divulged in this article.
The equipment rental market is dynamic; you could choose to rent out anything as long as it’s what people need. Usually, a customer comes to your store or warehouse to rent a piece of equipment, and after certain conditions have been met, you reach an agreement. The agreement you both will reach involves the manner with which they will get the equipment, how long it will be in use, and what it costs to rent it.
This business can be done from home in the early stages, and that also depends on the type of equipment you have to rent out and the location. A remote business is suitable for fresh entrepreneurs because it helps take some weight off their shoulders. The cost of renting a warehouse or shop, the need to hire extra sets of workers, and others, will be out of the picture. As long as you have enough space for storing and servicing your equipment at home, you are good to go.
As your small company starts to expand, you will need to purchase more equipment and create a room where your customers would visit, test, and carry the tools from. For example, if you choose to rent out books, there won’t be a need to rent a shop from the get-go. You can use your house, and if you have a study, that will do just fine. But if you choose to rent out portable toilets, for example, then you should be ready to have a storage unit for your equipment. The cost of launching this business depends on the kind of equipment you want to rent out, but it is relatively inexpensive to start. Some will only cost you a few thousand dollars, while others can be up to six figures.
As the owner of the rental business, you will also be partially responsible for any damages suffered as a result of using your equipment. Faulty equipment can land you in hot water, which is why you must make sure you rent out tools in perfect working conditions. Make warning signs and other tips for using your equipment safely available to your clients. Once they are aware of the risks involved, it would help them make better use of the tools. And in your case, it would mean that you have done the best you can to help alleviate any imminent danger.
What you need to think through first
Having gotten the necessary information about the equipment rental business, you should consider a few factors before starting yours. These factors will help you make the best decisions before joining the league of equipment renting entrepreneurs.
The cost of maintaining the equipment
If you want to do this business full-time, you will need to get enough equipment that will go round once your customers start trooping in. The number of equipment you will need will increase with time, and the prices for them will most likely not come down either. When you make up your mind to start a business of this nature, also consider how much you have in your budget. For this reason, it is advisable to have more than one other option before you start your feasibility studies. If you dream of having the one-stop-shop for party decorations, for instance, while camera renting is also on your list, find out which one is cheaper to start. Camera equipment is expensive, and for that reason, you might decide to go for party decorations instead. This decision does not spell the end for your camera renting firm aspirations; it only means that you will start with something else. The cost of purchasing is not all there is to consider; how much it will take to maintain them is also crucial. The cost of servicing and storing them, including insurance, should be considered. If you are renting out a type of tool that will be hauled to the client, be sure of how much it will cost you to get them over to your customer. You might need to get a haulage vehicle for it- now you know why you should count the cost.
What works for you
In the equipment rental world, there are some major income generators. Not all equipment will generate money the same way for their owners due to different factors like the demand and the cost of purchasing the equipment. However, the prospect of a type of equipment rental business to bring in more money than others should not be your reason for starting one. The best way to go about establishing your new rental company is to find an area that you are good at. A niche that you are very comfortable with will make it easier for you to understand the business better. If you love books and you have a library of hundreds of them, you won’t be making as much money as someone who rents out RVs. It would be a mistake to forgo renting books because you’d be earning less. Remember that you would have to relearn the rudiments of RVs, spend money to purchase one or two, before thinking of where to park and service them. Get better at what you already know and have and discover better ways to rent them out.
The locale
As much as it is advisable to start with what you are comfortable with, with time, you can move on to other things. Some people can afford to start any equipment rental business because they have the money. For a person or group of persons who are going into this business strictly to make money, the place you choose to set up a shop should give you a clue. This is one of those business ideas where the demand drives you to set up the right market. It is better to make your findings first before choosing what to focus on. What is the most common vocation of the people in the area? If the average person is a woodworker, then you know what tools you should invest in. If you decide to open your equipment rental store in a riverine area, most of the people would either be fishermen or fishmongers. Fishing equipment like hooks, nets, boats, boat engines, scales, and others, will need replacing, fixing, and also to be rented from time to time. Also, make sure that the environment has little competition, and if they do, find ways to make your services much better.
Another thing the neighborhood will tell you is the quality of tools they will be able to afford. Developed places like cities are already used to renting quality products at high prices, while it is the opposite in rural areas. The low standard of living in the area you choose to open your business doesn’t mean you should offer fewer quality services. It only means that you can buy less expensive and fairly used equipment that is in excellent condition. Open a store in an area that is easy to locate and access; the rest will be less complicated.
Practical steps to starting an equipment rental business
Provide online payment and booking options
These days, you have to expect the average customer to look at purchasing or renting an item online. Almost all the equipment rental businesses around have websites and social media accounts. These online platforms will make you accessible to your clients and potential customers. Your website can also be used to create booking options. To make the best use of your website and online platforms, take professional pictures of the equipment and put it up there. It is more appealing to see what one wants to buy first; it makes one want to make a purchase. Also, make payment options available so that people can book and pay online for your services at once.
Register your business
The first thing you’ll need before registering your business’s name is literally a business name. The name of your business, along with other essential details, must be documented. This document is your business plan. All you have in mind for the business, how you want to operate it, what you expect to encounter, what it would cost, and what you’ll call it should be in the plan. After making a business plan, start looking for ways to get your permit. Some equipment will require that you have a license as a technician, while some might require that you have medical certification. Therefore, you must get them before starting. Failure to get these licenses and permits could result in a criminal offense. Most of the governmental agencies these days have websites with their contact details on them. Locate their offices and get the necessary permits.
Hire skilled hands and get your tools
The more your business grows, the more hands you will need to help manage it. The workforce for your business will cut across different aspects of the firm. Some workers will be in charge of maintaining the equipment; others will have additional responsibilities; while you’ll be the extra pair of hands. Having other people help with your small company will relieve you of stress and make you focus on other essential aspects of the firm. As soon as you get settled in, your equipment should come in. The skilled workers you have hired can start by helping you determine the most suitable tools for the business. If you can’t afford new equipment, buy used ones that still work perfectly.
Acquire a store
Getting a storehouse or shop for your equipment depends on what tools you want to rent out and how big you intend to go with it. The critical thing to note is that you are running a business, not a hobby, so you have to be professional. Securing a place where customers can go check out the merchandise before taking them for a spin is the next step. The location of your store must be accessible and easy to reach. Depending on the site and the rules regarding the opening of businesses like this, you will need to secure a permit to commence.
Insure your equipment
Anything can go wrong in a typical equipment rental business. Tools can go missing, and some can be stolen, while you could rent some to con artists and neither see them nor your equipment again. For this reason, you need to insure your business- the equipment in particular. Insurance companies usually charge more when the items to be insured are frequently used or have a big chance of getting lost or stolen. Insuring your equipment may take time and sometimes cost more than you expect, but it will be worth it.
Make a price list and terms of use
Before renting out the first equipment, take measures that will protect you and your company. Some of these security measures include creating documents or disclaimers for prospective clients to be aware of. Some of the items you have for rent might be dangerous if not handled correctly; let clients know they’ll be using them at their own risk. Advise customers to get a professional to use the tools for them. Let them know how much it will cost to use the tools for a while. Let them be aware of the fines attached to late returning or returning tools in harmful conditions. And make it clear that the devices were given to them in the right conditions, and if necessary, they should sign an agreement before using them. This will save you from legal trouble.
Be familiar with your equipment
Your equipment is the soul of your new company; the more you know about it, the better your chances are of getting the best out of them. The type of equipment you have will determine what maintenance and servicing techniques will work best for them. Good knowledge of your tools will make you aware of the environment in which they need to be stored to preserve them. The best way to know a lot about your devices is to use them; every once in a while, try them out. You will discover new tricks to work them that were not in the manual.
Equipment rental goes beyond opening a shop somewhere filled with tools for hire; it’s an industry that’s worth billions of dollars in the U.S. alone. There are unwritten rules on how to run this business successfully, and there’s still more to learn. This industry thrives in some areas than others. There are reasons why the big keep enjoying success, while some startups close down. All this information will give you a clear indication of the best ways to start and keep running your new business. Keep tabs on industry trends to see what the future of the industry will look like in the coming years. A good understanding of what you’re into will make you succeed where others are failing, and you will be ahead of your peers.
Simple ways to maintain a thriving business
An equipment rental business is a type that fetches income for the owner regularly. There is hardly a growing equipment rental company that does not make enough to keep the business moving. However, just making a steady income from this venture is not enough to take the company to greater heights in the industry. To ensure a thriving equipment rental business, make sure you work on these few things.
Offer extra services
It’s okay to have an equipment rental shop and a few other things on the side for customers to enjoy. Your business is whatever you make it out to be. If you want a place where people would show up, get what they came for, and walk away, you’ll have it. But if you wish to have a business center where people can have a swell time while they handle their business, you’ll also get it. Apart from bringing in more earnings for your company, offering extra services will make your customers have one more reason to visit your store.
While it is advisable to render additional services, avoid unnecessary add-ons. Only services that are in line with your business are what you should consider. Start by asking yourself what else a customer might need while they rent equipment, and what they’d like to have while they perhaps wait to get their tools ready. Some customers also have tools at home, but maybe they need more to finish a job, they’ll need to service their own tools at some point. You can add equipment servicing to the list. And some will need to buy new or used tools in the right working conditions; why not make some of yours available so that you can sell for the right price? And even when you have no equipment to sell, or the customer prefers to buy a new one, they’ll choose to ask you for professional advice. Collaborate with top equipment sellers so that whenever a customer needs that assistance, you’ll refer them to your partners and get a commission.
Make smarter equipment purchases
A business can begin by incurring unnecessary losses before hitting the ground running like failing to make smart purchases. In the case of an equipment rental business, the failure to buy your tools intelligently may seem subtle, but it means that you’re hindering yourself from making a profit. Before you start your company, the tools you will be offering out should be the best for their price. If you have studied the market, you’d know if there is a need to buy brand new equipment or not. There’s no need to buy new tools if it isn’t necessary, as long as they can do the job. Get better deals on the equipment you buy and use coupons if you must to get a good discount. Use the internet, find people who have some of the tools you need, and go over to purchase them. It is cheaper when you go to a private user of a device that at stores. Some excellent equipment for your business gets auctioned from time to time; get involved in the bidding war. The less you spend on quality products, the more affordable your services will be. Who doesn’t like a cheaper alternative?
Equipment maintenance
The backbone of every equipment rental business is, without a doubt, the equipment for rent. The quality of the equipment, and its freshness, will mean that the equipment will have a relatively long lifespan. The storage and how often it is used will also tell how far they’ll go in the business. Seeing that you will be renting out the equipment for different purposes and durations, they will lose their competence each time they are returned after use. While you might have a strategy that involves either selling used or worn-out equipment for change and still get something for it, there are better ways to save money. Maintaining your equipment will not only make your equipment last longer; it will save you money. The more you take care of your equipment, the better shape they are in before they are needed. A well serviced or oiled machine will work almost the same as a new one, and your customers will trust that you render quality services. Proper maintenance of your equipment will keep your customers satisfied, and even if you want to sell them later on, their market value would still be pretty decent. A satisfied customer will keep coming back, and loyal customers make great companies.
Conclusion
Renting out equipment is for people who know a thing or two about the items. The moment you get the essential permits and have secured a storehouse, start working. Look out for opportunities to get more customers in. If you deal with construction tools, look out for construction sites around. If you rent cooking equipment, keep an eye out for a bake sale or other outdoor events. Keep spreading the word about your new rental company, and you’ll do just fine.