In your gear rental business, a significant amount of your revenue and margin comes from selling your used rental gear at the end of its rental life. Yes, I said rental life and not season or year. Read on for more information on rental life!
Used gear sales are different for every business, but there are best practices that you can follow. We are going to share some of these best practices with you below, gained from working in Home Depot’s Corporate Tool Rental management business which operates over 1100 tool rental locations in the US alone. In addition, (and most importantly) we have incorporated the best practices that we have found while visiting over 200 gear rental shops in our travels across the country, meeting awesome outfitters like you!
Basic Example:
Not only did the shop just make 30+% margin on the product, but they were also able to drive 30 customers into the shop that hopefully bought merchandise while in the store (shirts, hats, stickers, jerseys, water bottles).
Although it is a simple idea, there are many considerations and factors that optimize the process and your revenue.
Sell your rental gear at the end of its “Rental Life” to maximize your revenue. Depending on the type of gear, some assets you may decide to keep in the rental fleet for 3-4 years while others you may sell multiple times a year. Determining factors of the gear’s rental life and when to sell include:
When to sell really depends on the gear, here are a couple of options:
**Don’t forget to work with your tax advisor/accountant on depreciation – there are some important tax benefits to depreciating your rental equipment!**
Use our handy Calculator for Sale Price of Rental Equipment to figure how much you should sell the gear for at any given time.
2018 BMC Speedfox 03-1 29er that retails for $3150 selling for only $1999.
PROOF: Did this image capture your attention more than the plain text version? This is just a quick version – you can add features of the bike, any upgrades, and more to the picture!
Can you help other shops by providing YOUR best practices? We want to hear from you! Please fill out the survey, comment below or send us a note and we will continue to update this article with the most useful tips on making the most out of your used gear sales.
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