EquipCalendar

Working out the details of your equipment rental agreement is a lot of work.  We at EquipCalendar understand and hopefully we can help with our series of blog posts about the basics of an equipment rental agreement.  Today's post focuses on payment.  Here are some suggestions:

Explicitly define the rental rates the Renter agrees to, for each and every piece of equipment included in the rental.  Define the amount per minute, hours, days, weeks or months they are renting the equipment for.

Include an "authorization to charge" the debit or credit card on file and that all payments and fees due under this Agreement will be charged using that card.

List all "other charges", this can include optional services, such as cleaning and repair, applicable taxes, loss or damage or repair, late fees, expenses to recover unreturned equipment by the Renter, and all costs to collect unpaid monies due (including insufficient funds).

Also, should your business support installment payments, define the terms (days or dates within a due date) for making those payments and any surcharge per period (hours, days, weeks, months) for late payments.

In case you missed the first post in this series, regarding "Defining the terms", you can find it here.

The best place to start designing your rental agreement is to define the terminology you will be using in your equipment rental agreement.   Think of it as a glossary or dictionary, i.e. give meaning to the words you are going to be using repeatedly.  Here are some suggestions:

Renter:  The exact name(s) of the person, persons or business, including staff name(s), renting your equipment.  Include their address and any or all contact info.  Establish their identity!

Owner:  The name of your legal entity representing your rental business.  Include full address and multiple forms of contact.  Give the Renter every available option for reaching you in need!

Equipment:  The brand, model name and serial numbers of any or all equipment provided as part of this rental agreement.  Even if it's just an accessory provided as part of the main rental, include it here.

Use:  The customary use of the rental equipment, including it's manuals, in accordance with any applicable law.

Agreement:  This document and how it represents the entire understanding relating to the subject matter hereof and prevails over any prior or contemporaneous, conflicting or additional communications.  The Agreement can only be modified by a written amendment signed by the Renter and Owner.

Stay tuned for the rest of our ten part series on the basics of a rental agreement...

To avoid wasting unnecessary time listening to every company’s sales pitches, you should come prepared with a list of specific needs and limitations.  Being proactive with your approach can get you quotes that most buyers will never get, because the leasing company knows that you are serious about renting their equipment and could step away if they feel that they aren’t being heard.

Companies that have a good reputation will lay out everything in plain English and will not try to skip any of the fine print.  This is especially important for a long-term contract, where you’ll be in a close relationship with that company for a long time.

In the tough economy of today, investors are much more complex and are able to select from a wider array of options today to minimize risk and maximize profits.  It seems that the biggest challenge of today’s market landscape is finding ways to inject more capital into their business, by building up a strong foundation, which can come from reducing equipment costs through leasing equipment.

No matter what type of business or industry you’re in: medical, construction, retail, automotive, or office space, there are going to be opportunities for you to take advantage of through renting instead of outright purchasing equipment.  The distribution channels are favoring major investments, giving companies fewer options.

Entrepreneurs stepping foot into new markets are a high-risk investment for venture capitalists, so it’s going to take a lot for them to take the first bite.  The truth is, the odds are not in the favor of the little guy who is trying to grow his business.  They’re a nobody, an unknown brand on the market that has to prove themselves to be worthy of investment.  It makes most industries involved in the utilization of expensive equipment, parts, and services start in a very precarious position, as margins and sales are typically hard to move into the positive right out of the gate.

The big name brands in their respective industries started in an advantageous state before the 80’s, when regulatory rules and competition in the rental business was much more relaxed.  The road for the small business startup who wants to turn a profit being an equipment dealer is a long and hard one, but for those who tough it out and develop a successful strategy, the rewards will be well worth it, as more and more businesses depend on renting equipment to help grow their businesses and get the investment capital they need to continue to prosper.

Renting equipment, rather than outright purchasing is a major bargain for businesses.  At some point and time, you’re going to hit a ceiling on your profit margins, and you’ll need to start looking at raising your rates.  The renting business is very lucrative, once you have your foot in the door, it should be producing numbers as high as two to three times as much as your typical retail establishment.  

If you’re asking “how?” while reading this, then the answer is by carefully crafted rental fee rates.  Not too much, to where you scare off your new customers, but not too low to where it just looks like you’re trying to nickel and dime your regulars.  Before raising your equipment rental rates, you need to make sure all other aspects of your business are up to par, let’s go over the key parts.

Customers have daily and weekly equipment needs. This means multiple opportunities for contact each week. Frequent interactions provide the opportunity to know the customer. People generally enjoy doing business with people they know.

Rental is about reliable delivery of services — your capacity to serve the needs of your client by accepting the money related risks, the logistical pains and the continuous upkeep and repair parts of relationships. You are offering them more than just equipment, you’re offering them a partnership.

Rental builds the stream of new products into the business by bringing down the clients’ investment risk. Offering dependable rentals is truly "repackaging" existing items to draw in more clients and change their purchasing habits. Rental has a tendency to open up business sectors where deals have been moderate, and build market infiltration where deals are energetic. 

Equipment rentals can be a standout factor amongst the best in any given industry, showcasing relationships and connections with a non-traditional hardware merchant. Offering simpler access to tools that businesses need, previously unobtainable, is now all a part of a strategic business plan, which will pull in new clients at a remarkable rate. 

Equipment rental is not a one and done business decision, but instead a long haul relationship serving clients. Showing rentals to your clients ought to be considered as instructing your clients to better deal with their hardware necessities through "outsourcing." Rentals offer clients effective utilization of budgetary capital and also HR in administration and backing. 

Advantages for those that properly position themselves in the rental channel include: 

• Quicker merchant installments - rental companies make income that can pay down merchant obligation 

• Builders will have a generally safe strategy to experiment with new brands or items 

• Merchant who use rentals develop the utilized machines that will help seed the business for parts and administration 

• Improves merchant productivity 

• Diminishes the general business hazard for the new small businesses 

• Rental permits clients with negligible financial assessments to get acquainted with equipment 

• Rental gives the new merchants an administration stage to draw in clients showing their capacities before offering the client the final product

Economic instability is the companion of an equipment rental business. Rental ought to be perceived as the answer for every industry that needs expensive equipment. It's useful for the OEM, useful for the merchants, and useful for the builder, genuinely a foundation for future investors.

Enter a start date, end date, specify the group by (Day, Week, Month or Year) and status (Quoted, Confirmed or Both).  The report can preview the data or export it to CSV (Comma Separated Values).

Period:  Date, Week, Month or Year

Inventory:  The name of your product

MaxQty: The maximum available quantity of the inventory item/product.

Inactive: Inventory status.

Events:  Number of events the inventory item/product is scheduled for in that period.

Rentals:  Number of units rented in that period.

Avg Price:  Average price of each unit rented in that period.

Avg Sale:  The average total sale amount for all events in that period.

Grand Total:  The total sales for all events in that period.

No matter whether you use a PC, tablet or smartphone, our reports will provide a nice printable format for use on that device.

The above CSV export is for the Day grouping (group by).  It also has columns for Year, Month, Day and Day of Week for further analysis.  What you see above is what you'll get when you export this report to CSV (Comma Separated Values).