How to Price Rental Items and Calculate Equipment Rental Rates

Pricing rental items can feel intimidating when you’re just getting started. It’s easy to worry about charging too much and scaring customers away, or charging too little and barely covering your costs.

Learning how to price rental items isn’t about finding the perfect number on day one. It’s about choosing a rate that makes sense for your business, testing it in the real world, and adjusting as you go.

Many guides focus heavily on formulas and spreadsheets. While math plays an important role in how to calculate equipment rental rates, pricing in the real world is shaped just as much by booking behavior, availability, seasonality, and customer expectations.

This guide will walk you through how to calculate equipment rental rates in a simple, beginner-friendly way, without turning pricing into a complicated math exercise.

The two stages of pricing rental items

Instead of trying to “get pricing right” from day one, you can approach your rental pricing as a process with two clear steps.

Set a reasonable starting price

Instead of trying to “get pricing right” from day one, you can approach how to price rental items as a process with two clear steps.

This is where simple calculations help you understand your costs and choose a price that makes sense as a starting point, even if it’s not perfect. At this stage, you’re learning how to calculate equipment rental rates well enough to avoid underpricing.

Adjust your prices once you see real bookings

This is where most learning happens. Customer demand, booking patterns, and availability will quickly show you whether your prices are too high, too low, or right where they need to be.

You don’t need perfect numbers—just a solid place to start and the willingness to adjust as you learn.

Step 1: Set a starting price

At the beginning, your goal is simple: set a price that helps you earn back what you spent, while still feeling fair to customers. This is a key part of learning how to price rental items sustainably.

Start with what the item costs you

Write down:

• What you paid for the item

• Any extras needed to rent it out (bags, cables, sidewalls, chargers, etc.)

• An estimate for cleaning, repairs, or general wear over time

• This gives you a rough idea of how much money the item needs to make back.

Estimate how often it can be rented

You don’t need a perfect answer here. Just ask yourself:

How many times can this item realistically be rented before it needs replacing?

For example, event equipment might last 40–60 rentals, while more durable items might last much longer. Thinking this through helps prevent underpricing and supports better decisions when learning how to calculate equipment rental rates.

Use a simple calculation

Here’s an easy way to think about how to calculate equipment rental rates:

• Divide the total cost by the number of rentals you expect

• Increase that number to leave room for profit and slow periods

This gives you a practical starting point.

Example: pricing a party tent

Let’s look at one clear example of how to price rental items.

Item: 20×20 party tent with sidewalls

Costs:

Tent and accessories: $2,400

Cleaning and repairs over time: $500

Extra costs per rental: $50

Expected number of rentals: 50

Cost per rental

($2,400 + $500 + $50) ÷ 50 ≈ $60

This means the tent needs to earn at least $60 per rental just to cover costs.

Set a starting rental price

To make a profit and cover downtime, you might multiply that number:

$60 × 2.5 ≈ $150

Daily starting price: $150

This isn’t “the correct price.” It’s a starting point you can test as you continue learning how to price rental items.

Final checks before you move forward

Before finalizing your price, ask yourself:

• Does this seem similar to what others charge nearby?

• Would I feel comfortable paying this price as a customer?

• Can this price still work if the item isn’t rented all the time?

• If the answers mostly feel right, you’re ready to move forward.

Step 2: Adjust prices based on real bookings

This is the part most beginner rental businesses overlook, but it’s also the most important.

Once customers start booking, their behavior tells you far more about how to calculate equipment rental rates than any spreadsheet ever will.

If an item isn’t getting much interest

It doesn’t always mean the price is too high. It could be that:

• Customers don’t find the item easily on your website

• The rental period is too long or too short

• Demand is low at that time of year

Lowering prices too quickly can hurt your business more than it helps.

If something is always booked

That’s often a sign you could charge more. If customers book weeks in advance or availability disappears quickly, your price might be too low.

In some cases, a slightly lower price can also lead to more bookings, and more total revenue. That’s why how to price rental items is about balance, not chasing the highest possible rate.

Using pricing structures to encourage longer bookings

One powerful way to fine-tune how to price rental items is by using pricing structures instead of a single flat rate.

With custom pricing structures, you can assign a specific price to a specific rental duration. For example:

• $20 for one day

• $30 for two days

• $40 for three days

This lets you automatically offer better value the longer a customer books, without manually discounting each order. It also helps increase average order value while keeping your equipment rental prices fair and transparent.

Pricing structures make it easier to apply what you’ve learned about how to calculate equipment rental rates in a way that customers clearly understand.

Connect your pricing to your daily operations

Pricing rental items isn’t just about numbers—it plays a big role in how your business operates. Your prices affect availability, rental length, busy and quiet periods, and even how much work each booking creates.

Rental periods

• Minimum rental days can protect your income

• Short rentals may need higher daily or hourly prices

High vs. low season

• Higher prices during busy seasons often make sense

• Lower prices during slower periods can increase bookings

Extras and add-ons

• Instead of raising your base price, you can charge separately for:

• Delivery or pickup

• Setup or breakdown

• Extra accessories

This approach keeps your equipment rental prices fair while increasing order value, giving customers flexibility and helping your business earn more without raising prices across the board.

Start simple and learn from real customers

If you’re new to rentals, you don’t need to master how to calculate equipment rental rates right away. Aim for pricing that’s good enough to get you started.

Use simple math to understand your costs, set a price that feels reasonable for both you and your customers, and launch. Once your items are live, pay attention to how customers book and respond, and adjust as needed.

The real answer to how to price rental items and how to calculate equipment rental rates is simple: start small, test your prices in the real world, and improve them over time.

By Catrin Donnelly · Last updated January 6, 2026

Catrin is a rental software expert with a digital marketing background. She’s interviewed over 1,000 rental businesses to create insightful, actionable content.