Are you looking to start a rental business in 2023?
If so, you’re in luck because rental businesses can be a great option, especially in today’s sharing economy. Renting out products or services rather than selling them outright can provide a steady income stream and require less capital upfront. In 2023, there are numerous rental business ideas that are gaining popularity, ranging from traditional equipment rentals to more unique offerings like vacation rentals and event rentals.
Times have changed, and the new generation of hustlers and dreamers live by new standards. While the old generation is watching cable TV, the new watches Netflix. The old is listening to Radio while the new is using Spotify. And, these changes are not limited to small choices.
The age-old dream of owning a house or a car is not what the new generation is seeing. They believe in renting rather than buying, and saving a large chunk of capital to invest smartly in assets and not liabilities.
The modern dream of a new generation of the working class is to travel the world and use new things rather than tying up all their money in costly one-time investments. This is the reason why rental businesses are making good revenue for the last half a decade.
All of this cultural change has impacted not just common lives but also business models across the world. This rental culture is what made companies like Uber and Airbnb become one of the world’s biggest enterprises.
In this blog post, we will explore some of the most popular rental business ideas to start in 2023 and provide some insights on how you can get started. Whether you’re an entrepreneur looking to launch your first business or a seasoned business owner looking for a new opportunity, these rental business ideas offer plenty of potential for growth and profitability.
So, let’s dive in and explore the exciting world of rental businesses!
How To Start A Rental Business?
After reading the introduction now, you must be interested and thinking, “how to start a rental business?”. You don’t need to be as rich as the firms mentioned above to start your own best rental service business. You can start small, build a loyal customer base (just like any other startup), and expand as your revenue grows.
Are you looking for guidance to start your own rental business? We’ll help you with a detailed plan of action.
Starting a leasing or rental service business is definitely a smart model to earn a huge profit with mostly a one-time investment in inventory.
Here are some statistics to back your rental business ideas in the USA:
- According to MarketsandMarkets, the US equipment rental market size was valued at USD 49.5 billion in 2020 and is expected to reach USD 65.4 billion by 2025, with a CAGR of 5.7% from 2021 to 2025.
- In 2020, the vacation rental market size in the United States was valued at USD 87.1 billion and is projected to reach USD 161.0 billion by 2027, growing at a CAGR of 8.1% from 2020 to 2027.
- According to a survey done by Grand View Research, the US car rental market size is expected to reach USD 37.3 billion by 2027, growing at a CAGR of 6.4% from 2020 to 2027.
- The US construction equipment rental market size was valued at USD 47.3 billion in 2019 is expected to reach USD 73.3 billion by 2027, growing at a CAGR of 5.4% from 2020 to 2027.
These statistics suggest that rental business ideas such as equipment rental, vacation rental, and car rental are growing in the USA, presenting opportunities for entrepreneurs to start their own rental businesses.
So, how does this work?
Choose the Best Rental Business Idea
There are many types of equipment, locations, and services that you can offer rental service, but choosing the right one will make all the difference in your success or failure as a company. One of the simple logic here is to offer rental services for things that people need once in a while but are costly to purchase.
For instance, could a middle-class family afford to buy a bounce house for a birthday party or an RV for their vacation trips? It’s obvious that not every family can afford to make such big purchases. And even if they could, it would simply be a huge waste of money.
This is exactly why rental businesses have and will always continue to thrive. We will talk more about the most profitable rental business later in the blog.
Rental businesses have been around for a long time, but with the latest technological advancements in app development, these rental ideas vertical is shining brighter than ever.
Build a Solid Business Plan
A business is only as good as its strategy. If you are thinking of starting a rental service business, then you better have a foolproof plan. If you are new at starting a business, it could be difficult to create an entire business plan on your own.
Depending on your service, some of the big preparations that you need to do logistically and manually to set up a rental business are:
- Proper Warehousing and Storage
- Safe Transportation of Equipment
- Cleanliness or Maintenance of Property
All of these factors are important when calculating the cost of setting up a rental service business. It’s just one of the many factors you need to focus on while creating your rental service business plan.
To do this correctly, you need to have an expert business analyst by your side who can weigh all the risks and revenue sources. You can either hire a solo practitioner or go with an app development team that provides such services.
Know more: Build Your App From Clone: Software Vs. Company Approach
Develop A Rental Service App
Once you’ve chosen what kind of rental service your business will offer, next you need to know how to develop an app? A professional app development company like aPurple can offer more than just an app development service.
By choosing an app development company with the most senior and experienced resources, not just in app development but in designing and in business analysis, you will get an all-around service if you choose the right app development plan.
There are two ways to go with developing your best rental service application. You can either go with a custom app development option, which is costly, and takes several months but gives the best quality app. You could also go with a clone app development solution, which will be almost 1/10th the price and could be fully built within a week.
The clone solution may feel lesser than the custom app, but compared to the huge savings on investment and the time-to-market, it’s a very beneficial deal.
Promoting Your Rental Service Business
Once your app is all ready to launch in the market, it’s time to roll the ball on promotions. You need to know who your target audience is to efficiently market to them and make every penny of your marketing cost.
For instance, if you are offering rental services for office space, then your target audience will be growing offices executives, and the platform to market would be LinkedIn. So, wasting time, money, and other resources in advertising for rental offices on a platform like Instagram.
You can hire a marketing expert or even a small team to take care of your promotional activities.
The 10 Best Rental Business Ideas
Are you looking for profitable and lucrative rental business ideas?
If you are searching for the best renting business ideas, then you are in the right place. Here we will be discussing the most popular renting business ideas that you can start as your own startup.
The startup cost of launching a leasing or renting business depends entirely on the idea you chose and the types of products and equipment you need.
1. Party Supplies Rental Business
Unless you are Charlie Sheen, your parties are mostly in the range of once a couple of months or even less. Whether you need a bouncing house for a birthday party or a karaoke machine for an office party, renting the equipment will be the right decision.
You don’t just have to offer single equipment but offer an entire party theme and plan. You can offer party supplies rental packages for various events like picnics, birthdays, reunions, etc. Starting a party rental services business is lucrative because parties go on a year-long, and you’ll keep getting customers for your business round the year.
2. Wedding Equipment Rental Business
Technically weddings can be included in the party rental business ideas, but you and I both know that weddings are an entire event industry. With engagements, family dinners, bachelor parties, marriages, and receptions, a wedding is an entirely separate event with one of the most lucrative business verticals.
What would a bride and groom prefer? Are you offering a standard two options on table fabric or an entire range of options varying in material, texture, and thread counts. Any couple would prefer to have the second option as that offers a more detailed and dedicated service.
By focusing exclusively on weddings, your rental business can offer a wider variety of options for your potential customers. Wedding planning and equipment rental companies are widespread across the United States and the UK.
3. Furniture Rental Business
Whether you are in a new city for a few months or need loads of furniture to set up your office, buying new furniture for limited use seems like a very costly investment, especially when you start new.
One of the perfect examples would be expecting parents going to buy baby furniture. In most cases, such furniture is only useful for a particular period of time. After the children grow up, such furniture becomes a waste of money and space. So, nowadays, most parents prefer the furniture rental model instead.
Moreover, the furniture rental business idea is such a niche scope, yet you can appease a wide audience as everyone needs a particular type of furniture.
4. Vehicle Rental Business
The vehicle rental business idea is a very popular one among all the others. Besides, there is a scooter rental business profitable in every sense of business.
There are many different kinds of startups available according to the type of vehicle rented.
Types of Vehicle Rental Service Ideas:
- Car Rental (Usual & Luxury)
- Bicycle Rental
- Boat Rental/Jet Ski/ATV Rental
- Commute Bus Rental/Party Bus Rental
- Electric Scooters/e-Bike Rental
- RV Rental/Boat House Rental
- Truck Rental
- Private Jet/Helicopter Rental
The most common vehicle rental business idea is of starting a car rental service business. The perfect place to start such a business is incorporate cities like New York and Silicon Valley, or tourist cities like Las Vegas or Amsterdam. In both cases, people are interested in renting a vehicle for a short span ranging from a few days to a few months.
The next level of vehicle rental business comes with long or large-size commute in vehicles like Buses, Trucks, Private Jet, etc. where owning such a big transport is impossible and renting for single trips is the best option.
The final level of vehicle rental business (this is the oldest one existing) is recreational and leisure vehicles like RVs, Boats, Party Buses, etc. In most cases, such vehicles are a seasonal business where people use them for their vacations or an impromptu getaway from their mundane life.
5. Clothes Rental Business
This particular rental business idea is very quickly becoming the next big thing in the rental service vertical. Mark Twain once said, Clothes maketh man. This very popular and apt saying fives the reason why the clothes rental business is the future.
When you go to a party or a business meeting, it’s the clothes that make your first impression in front of your date or client. But, not everybody can afford to buy such grand and expensive clothes for one-time use.
That’s why the trend of renting such clothes for a day is becoming the new normal. This way, you don’t repeat your wardrobe ever to a party and get to wear the most amazing clothes at low rates to events that would have previously put a significant hole in your pocket. All this for a charge is definitely far lesser than the cost of the dress.
Types of Rental Clothes to Offer:
- Grand clothes for special occasions
- Costumes for events or parties
- Formal Clothing
- Quirky Costumes
- Vintage Collections
Among all the other best-renting business ideas, this one is the cheapest to launch. The investment you make in purchasing the clothes and launching the clothes rental business is generally lesser than any other rental business.
You can also offer accessories rental service for items like watches, jewelry, glasses, belts, etc. to match with the clothes your customers rent from you.
The margin is lower than the rest of the businesses, but so is the startup cost, the risks, and the work needed to be done. You can even run this business as a single individual from your home.
The growth of your clothing rental business depends on the way you promote your company and its services.
6. Storage Rental Business
The next one up is a classic unique rental business idea. Who here hasn’t complained about not having enough space for things at home? We are part of a great nation’s culture of consistently purchasing and hoarding things, but what do you do when your space runs out, and there are new things to buy? You get yourself a storage locker.
Storage rental spaces are very common across America, and you can also get into this lucrative rental business model. There are more legalities to be taken care of and a lot of space needed to build your rental storage “farm.”
With the size of revenue that the storage rental services business makes, all the hassle and work are worth it. Make sure that your business follows all the regulations and is heavily insured against any kind of mishappening.
7. Property Rental Business
The property rental business is probably the business plan for renting rooms that can be considered as the most costly rental business startup idea on this list. But, it is also the safest and most promising business idea on this list. You can either start the property rental business by renting your own property or think big and follow the Airbnb business model to create a digital app platform and provide a space where renters and rentees can interact and finalize rental deals.
The types of properties may vary in many factors, but the three most common categories are housing, commercial, and recreational. You can offer a property rental service in any or all of them as per your preference and according to your state’s rent laws.
Types of Rental Business for Property
- PG Room Rental
- Apartment Rental
- Office Space Rental
- Event Venue Rental
- Vacation Property Rental
- Campsite Rental
- Land Rental
Property laws vary from state to state, so ensure that your property rental business follows all the rules and regulations in every state that you offer your rental services.
8. Sports & Hunting Equipment Rental
What’s life without an interesting hobby? Everyone needs a recreational activity for the weekends to keep the spirits flowing throughout the week. You can provide sports and hunting equipment rental services for people who seek the thrill of the great outdoors.
Your rental services could range across several sports that require costly equipment. Sports like:
- Kayaking, Canoeing & Rafting
- Sailing & Motorboating
- Hiking & Camping
- Rock Climbing
- Hunting & Fishing
- Skiing & Snow Boarding
- Horse Riding
- Terrain Biking
- Surfing & Scuba Diving
- Sky Diving & Paragliding
You can choose to offer equipment rental services in any and all of these sporting and recreational activities as per your budget on inventory. You can also start with the most popular ones and then grow from there as you see a higher revenue stream coming.
9. Tech Rental – Computer/Mobile/Tablet/Server
Modern problems need modern solutions. Starting a company has several costs to it; besides buying or leasing office property. Another high cost is on the infrastructure and the tech equipment needed for employees to function.
Buying computer systems for a startup of 50 or more could be a big investment. With recent tech upgrades happening every six months, it’s not very sound to make a huge one-time investment on tech equipment like computers, and phones when they seem to be out-dating twice a year.
Instead, the best option is to rent your tech and keep upgrading when you feel your systems lag behind the industry standards. Lots of large enterprises have been doing this for several years, and now this trend has also caught wind among small and medium businesses.
You can start your own tech rental business by partnering up with a wholesale distributor of tech products. Starting an equipment rental business for offices is one of the highest profit margin business models on this list.
10. Construction Equipment Rental Business
A construction equipment rental business involves renting out construction equipment such as excavators, bulldozers, and other heavy machinery to construction companies, and contractors for a certain period of time at an agreed-upon rate. The business idea is to buy or lease construction equipment and rent it out to individuals or businesses that need it for a specific project or duration.
The construction industry is always in need of equipment to complete projects efficiently and effectively. However, not all construction companies or contractors can afford to buy their own equipment. This is where a construction equipment rental business comes in. By offering construction equipment for rent, businesses, and contractors can get access to the equipment they need without having to purchase it outright. This saves them money and allows them to use the equipment only when it is needed.
To start a construction equipment rental business, one needs to have a significant amount of capital to invest in purchasing or leasing the equipment. Additionally, it is important to have a good understanding of the construction industry and the types of equipment that are in high demand. It is also essential to have a marketing plan to attract potential clients and to ensure that the equipment is well maintained and serviced to provide a reliable service. A successful rental business can generate a steady stream of income while providing a valuable service to the construction industry.
By doing a very good job in servicing the enterprise, you are bound to create a loyal customer base that makes periodic purchases from you. It’s a highly recurring business model with a whole new customer base yet to be explored.
If you’re looking for easy rental business ideas, consider exploring the rental business idea Philippines market for potential opportunities.
Start Your Own Rental Service Business
Developing and launching profitable rental business ideas may seem a bit complex and out of reach. With the right app development company as your technology partner, you can easily make it happen. Especially if you go with the rental app clone solution to build your app. Then, the cost of app development and the time taken reduced significantly.
Make sure that you choose the perfect rental app development company to build your app with a ready-made rental app clone solution, the rest will be taken care of by the firm. Now, what are you waiting for? Talk about your top rental business ideas with our app development experts and learn about our clone app solution.
FAQs
1. Is rental business profitable?
The profitability of a rental business can vary widely depending on the industry, location, competition, and management. Some rental businesses, such as equipment or property rentals, can be highly profitable with low overhead costs and steady demand.
However, other rental businesses like vehicle rentals, may have higher operating costs and lower profit margins due to factors such as depreciation and insurance expenses.
2. What are COGS for an equipment rental business?
The cost of goods sold (COGS) for an equipment rental business typically includes the costs associated with acquiring, maintaining, and repairing rental equipment. Additionally, labor costs associated with preparing equipment for rental, such as cleaning and safety inspections, may also be included in COGS.
3. How do you scale a rental business?
To scale a rental business, focus on expanding the product or service offerings, investing in marketing to reach new customers, streamlining operations to increase efficiency, and potentially opening new locations or partnering with other businesses to increase distribution.
4. What are the 4 types of income from rental?
The four types of income from rental businesses are cash flow from operations, tax benefits, capital appreciation, and equity build-up.
5. How much does it cost to create an app for a small business?
The cost of creating an app for small businesses can range from $10,000 to $50,000 depending on complexity, features, design, and development time.
