When people look to start their own party rental business, there are many things they overlook. Most consider that they just need to buy some equipment and say that they are renting...
When people look to start their own party rental business, there are many things they overlook. Most consider that they just need to buy some equipment and say that they are renting out stuff for parties, but it is much more complicated than that. It involves the same basic steps as any rental business, and they are necessary to follow to create a successful and sustainable business.
Of course, the social distancing rules of the pandemic made it difficult for anyone to operate a party rental business, never mind starting one from scratch. However, it appears most of the issues that it caused are behind us, and now is the perfect time to start your own party rental business.
Lockdowns meant that many party rental businesses had to close their doors and shut down for good, leaving gaps in the market for hopeful entrepreneurs. So, if you’re serious about starting a party rental business, there is no better time than now to get started. But to be successful in this niche, there are few rules to follow, and you will need to reflect and strategize to make the most of your investment.
Let’s go through the eight steps that are necessary to creating and growing a party rental business.
The first step when starting any new business adventure is market research. It will help you develop a plan for your party rental business and help you avoid any missteps in the early stages. Market research requires collecting information about your target market and what makes a successful party rental business. By studying the party rental market, you will be able to gauge what works for other businesses in your area, how they run their business and how they price their items and services. This gives you an indication of what’s involved in running a party rental business and what kinds of margins and profits you can expect.
After conducting market research and working out what and how you want to rent out products, the next step is coming up with a plan for your party rental business. This will be a document that discusses your mission and the strategies you will use to achieve it. You need to make sure that it is thorough enough to refer back to at a later date.
The key things to include in your party rental business plan are:
Your business plan should be an evolving document that develops as your business grows. Therefore, you should review and update your business plan every six months and update anything that has changed since the previous version. This will help you strategize better and make achieving your goals much easier as they move over time.
When you start a new business, you must make sure you have the correct licenses and permits. These will vary from country to country and state to state, so you must get the right ones for where your business will be operating. If you fail to do this, you could face expensive fines and even be forced to close your business.
Generally, you won’t need any license specific to party rental businesses, but there will be more broad business licenses required. You should check with local officials in your state or country to see what laws you need to comply with and how you need to go about acquiring licenses and permits.
Choosing the right party rental equipment largely depends on what your customers are looking for. If you ask enough people interested in renting party items, you will get a clear picture of what you need to purchase and see trends like tables, chairs, and party tents. You may also come across unique items like lighting systems, photo booths, and bouncy castles.
Remember that equipment will be the biggest purchase you make for your party rental business, and you need to make sure you don’t buy things that will inevitably gather dust. You also need to make sure you don’t overspend on equipment initially, as this will make it harder to dispose of underused equipment in the future.
If you are missing some equipment rented on a rare occasion, you can also sub rent it from other businesses. This saves you on overheads while still allowing you to cater to the needs of your customers. Your inventory list could be a mix of equipment that is easy to buy and store and equipment that you will sub rent from other companies.
As part of your market research and business plan, you should have a firm idea of what your competitors are charging and how much customers are willing to pay. If you take this information and apply it to your purchase costs, you will work out what you need to charge to be competitive and profitable.
Your prices should be similar to your competitors or slightly lower, so you have a competitive advantage. You don’t want to set your prices too low, though, as it will be harder for your business to make a profit or even break even. It can also affect how customers perceive your company, and pricing your equipment too low can make them suspicious of their quality.
Much like the licenses and permits you require to operate your party rental business, you will also need insurance to work safely and legally. As you will likely be purchasing a mixture of outdoor and indoor equipment, you will need to insure them against accidents and protect your investments. The potential of damage is small, but the risk of not having insurance isn’t worth it.
You will also need to take out liability insurance to protect yourself against and injury or harm that may come to someone while using your equipment. This will not only protect your business but will also improve your reputation with potential customers as it demonstrates that your business is trustworthy and responsible.
As with any rental business, you will need strong organizational skills to manage your business effectively. This means keeping track of your equipment, customers, orders, and pickup/return dates. Of course, you could do this with a spreadsheet, but as your business grows, it will quickly become unmanageable, so you will want to invest in rental software.
Booqable can help you manage all aspects of your party rental business effectively in one system, whether by keeping track of inventory, managing availability, accepting bookings, sending out documents, or even your handover workflow. Everything can be done within one app, including accepting bookings and payments online.
Marketing is key to the success of any rental business, and party rentals are the same. It should be among the first things you consider when planning your business, as it can be hard to get started without it. It’s the number one way to build awareness of your business and promote credibility. It’s how you will get your first customers and drive sales in the future.
You can use a few marketing channels to promote your business, including networking with local businesses, advertising in print media, social media, search engines, and Google My Business. Some of these are free a low-cost, which you can read more about here, but some can be expensive, and you should be aware of the costs before investing.
Get started and see the benefits of rental software.