An equipment rental business can be one of the smartest investments you can consider today. You can start your own business where you can rent out cars and boats, event spaces, appliances, AV equipment, and whatever else you wish to provide to your clients. But it will require plenty of work before you can start running your business.
You must follow the proper rules for starting your equipment rental business to keep it running well. Many of these points involve figuring out not only what you want to rent out but also how you’re going to acquire those assets. Your marketing plans are also critical to ensuring your success.
Follow All Legal Requirements
The first part of starting an equipment rental business involves reviewing all legal requirements for operation. In the United States, you can start your business as a limited liability company or LLC. As an LLC, you will not be held personally liable if your equipment rental business is sued for any reason. The income generated by your rental business will also be separate from your personal income, making it easier for you to manage and organize your taxes.
You can start your LLC by completing the necessary forms in your state and paying the proper LLC costs. The cost will vary by state, but it shouldn’t cost more than a few hundred dollars in most situations. The forms and the info you’ll require will vary by state and are relatively easy to find online.
You must also register for state and federal taxes before you can start operating in the United States. You can apply for an EIN or Employer Identification Number for your federal taxes. You’ll also need to apply for state and local taxes, employment taxes for any employees you will hire, and property taxes based on location. Each state has different tax rules for what works, so check with your state to see what you require.
The rules for starting a rental business in Europe will vary by country. You will have to apply for company tax in most countries, plus you will need to file additional taxes for any other countries in Europe you operate in. Value-added taxes may also be necessary for many of the assets you plan on renting out. All national governments in Europe have different rules for what taxes are necessary and what applications you’ll have to fill out, so check with yours to see what you need.
Establishing a Business Plan
You must then prepare a suitable business plan that fits your company’s needs. Your business plan should include the following details:
- Create an executive summary that summarizes what your rental business covers. The summary should answer how you generate income, how you will manage regular operations, and the beliefs and values you have in running your business.
- Figure out the specific market you’ll enter. You can choose a market based on what you will rent out and what audiences you wish to target.
- Your business model should include a review of how you will communicate with your customers and how you will make your assets available to others.
- A strategic management plan can help you see how you’ll manage your rental assets. A suitable software platform like Sales Igniter can help you manage your rentals and how you will book them.
- Your business plan also requires a look at what costs you will incur and how you will cover them. These include property taxes, maintenance costs, employee salaries, and anything else you will owe.
A smart marketing plan will make your business easier for the public to notice. You can establish a marketing plan with a few points:
- Start by figuring out your target audience. Look at who might be more likely to use whatever you are renting out, and think about the specific people who will contact you based on title position and other factors.
- Look at the area you’re going to serve before promoting yourself. You might stick with an area within a specific radius of your location, for example.
- Review how much you will charge for rentals and plan your marketing based on people who can afford to spend that money.
- Plan the measures you’ll use when targeting your audience. You can use your website, social media, B2B contacts, and anywhere else where people might see your messages.
You can also use a few marketing tips to improve how you promote your rental business:
● Create a website that describes everything you offer and your company’s vision.
● Create a blog on your site that provides information on what you are offering to your prospective renters. You can show that you understand your industry when you make blog posts that are detailed and thorough.
● Use social media to communicate with others and share your thoughts on your industry.
● Plan your marketing based on times of the year when people are more likely to rent your items. Look at what you are offering and prepare a marketing plan that targets people during these special times.
For plenty more useful Rental Business Resources please checkout our full Awesome Rental Business Resources list.
Choosing the Right Location
You can choose a good location for your rental business where you will be near many people who might be interested in your assets. Here are a few points to help you find the right location for your business:
· Look at the demographics of whoever is in the area you want to serve. Be sure you are in a spot where there are people who might be interested in your items.
· Be sure the location is within your operating budget. Some places might have higher taxes or rent charges than others, or they might have operating laws that are hard for you to maintain or support.
· See if there are proper vendors or suppliers in your local area. These include groups that can help you get equipment at good prices.
· There should be a sensible demand for your items where you will enter. Look for a location where people will need your items.
· Compare any competitors in your local area. It might be easier to operate in an area where there aren’t as many competitors.
How To Get Equipment At Wholesale Prices
You can acquire various items for rent from wholesalers willing to sell you vast quantities of items at low prices. Here are some steps to follow to help you find equipment at great prices:
- Be sure you have the necessary tax numbers and business licenses for operation before acquiring your equipment. You may also require a licensing agreement if you’re going to rent out trademarked items.
- Check with a brand manufacturer to see if they can sell items to you in bulk.
- Visit trade shows if you’re going to order from a manufacturer while in person.
- Check local websites to see what is available for purchase. A website like Handshake can offer wholesale goods from suppliers around the United States, for example.
Be sure you’re finding a supplier that you can trust, and avoid global vendors if possible. While many global vendors might offer more items at lower prices, they may have poor manufacturing standards while operating in unethical working conditions. Some overseas suppliers may also make counterfeit goods, as there aren’t as many intellectual property rights in some countries as in the United States or Europe.
What Rental Software Is Needed?
You will require rental software to help you keep tabs on your rentals and how people access them. A rental software program should include the following features:
● A booking calendar can help you keep track of who is renting items when, what rates you want to charge on specific days, and what dates are excluded. Sales Igniter offers a booking calendar feature you can configure as necessary.
● Your software will require a catalog feature where you can organize products based on what options are available for rent and how people can use product bundles.
● An order management feature will help you review orders and track when they come in. Sales Igniter provides a full layout where you can customize how customers place orders, including by providing multiple options.
● The software can also include payment and shipping support that includes SSL encryption, support for multiple payment modules, and various shipping modules like what Sales Igniter offers.
● A reporting program can help you review what items people are viewing on your website and if they have any abandoned carts.
● You can also use a rental software program that helps you monitor customer reviews, meta tags for items, and review what search terms people use the most. Sales Igniter uses all of these features for your convenience.
Learn more about the 10 Best Rental Apps You’ll Love.
Rental Inventory Tracking
You’ll need to keep tabs on how people use your rentals, including ensuring customers aren’t misusing anything they rent from you. You can use many measures to track your rentals:
● RFID tags and barcodes can go on your rental items to help you assign numbers to products you offer. You can use these numbers to keep track of your items, plus you can scan them later to keep track of your data.
● QR codes are like RFID tags and barcodes, except they can store more data.
● A GPS tracker can go on a vehicle or another item to help you review where someone is bringing an item. This feature is useful when you’re trying to track lost items.
You can use Sales Igniter to help you record data on all these codes in your inventory system. Sales Igniter helps you review numbers for individual items, giving you access to all your items as necessary.
Credit Card Processing
You have many credit card processing options to explore when helping people rent equipment. Be sure you choose a sensible processing option that provides enough features while offering reasonable rates for online and in-person payments.
Stripe is a popular choice, as it offers flat-rate pricing and a virtual terminal. It also includes ACH processing with each account. Stripe also supports integrations for Shopify, WooCommerce, NetSuite, and many other platforms. You can even create different checkout pages based on whatever data you’re trying to collect or how you’re going to bill a customer.
Other options to see include Square, a flat-rate solution that offers multiple payment platforms and no monthly fees. You can also use National Processing if you plan on handling more electronic check transactions, while Clover provides multiple point of sale integrations and modules.
Sales Igniter offers support for hundreds of credit card processing modules. Sales Igniter has a Magento Booking Extension and WooCommerce Bookings Plugin that can support hundreds of processing modules available through the Magento Marketplace or the WooCommerce payment providers directly.
Rental Security Deposits
You may require a security deposit from your customers before they rent things from you. A security deposit is an amount of money a customer will pay you before receiving access to an item for rent. You will hold that deposit in trust and pay it back to the customer after that person returns the item in full.
A security deposit will protect you from default on the renter’s part, and it can cover the cost of repair if anything is damaged. You have the right to refuse to return the security deposit if the renter brings back the item and it is damaged.
A new rental business will need to network with many others to make it easier for the company to thrive and grow. There are two aspects of networking to follow:
- Business-to-business networking involves communicating with other businesses in your field. You can contact vendors and other groups for access to various assets you can offer for rental, or you can reach contracts and agreements for various services.
- Consumer networking involves communicating with your prospective customers and sharing details on what you have to offer. You can directly contact customers by addressing what needs they have and providing answers to any questions they hold.
B2B Marketing Ideas For Equipment Rental Businesses
You can use a few business-to-business marketing solutions to make your rental business more viable:
● Don’t give away all the details about your business to others. Provide enough information to make your clients interested in your business, but hide enough details to make it so someone will want to call you again.
● Be sure to provide practical value in everything you offer to your prospective clients.
● When talking about your business, explain how whatever you have for rent can be to a client’s benefit. Explain why someone should rent the equipment before promoting yourself, as doing so gives the client an immediate need to contact you.
● Your call to action should only include two points, an identification of the problem and a solution to that issue. Make sure when talking to other businesses that you’re offering a smart solution that other businesses can trust.
Learn Basic SEO
Every rental business will need to understand search engine optimization or SEO when promoting themselves online. You will need to learn about how SEO works in many forms, including through these:
● Keyword optimization can help attract people who search for your site. You’ll have to figure out the right keywords to use for your website.
● Quality content is critical for being visible on a search engine. The content you write should incorporate the right keywords while also answering your searcher’s query.
● Your website requires a fast load speed and a simple user interface. Websites that load faster and take fewer steps to go from one spot to another will have better SEO rankings.
● Title, URL, and meta descriptions are essential to helping people understand what they will find when clicking on your link.
Learn Basic Social Media Management
The last part of starting an equipment rental business involves knowing how to manage your social media channels well. Be prepared to look at how you’re running social media by reviewing what measures you’ll use and how you’ll convey your messages to others.
Be sure when running your social media channels that you keep your voice consistent and that you’re posting the right information on the proper sites. LinkedIn is ideal for more detailed content, while Instagram can work for visual data, for example.