6 Biggest Issues Hurting Your Rental Business
The rental business was supposed to be a simple concept: rent or lease out an asset for a fixed or a recurring amount that customers will pay on schedule, right?
An average rental business in the United States involves buying, maintaining, and up-keeping assets to begin with. Then, there’s the never-ending list of elements as a part of the management side, such as:
- Managing rental inventory
- creating and overseeing rental contracts
- Rental invoicing and ensuring positive cash flow.
- Sending out alerts for contract renewals.
All of that on top of the usual business requisites such as hiring, payroll, sales, marketing, legal, finance, and accounting – that’s a lot to take in.
Your rental business, just as it is with many businesses, depends on a host of factors.
Some issues, however, could be hurting the potential of your rental business. Here are some of those and ways to counter them:
Statista reports that the top 500 retailers in the United States accounted for a total of 296.52 billion dollars in sales, in the year 2014. That’s only the tip of the iceberg.
With more than 75% of Americans having already purchased goods online, that only goes on to prove the “necessity” of selling online.
For most traditional rental businesses, there’s a huge emphasis on the need to go the ecommerce route.
The NetSuite Rental Management module makes it easy for your business to start plugging into a built-in ecommerce system to help push more sales and allow for more options for your customers to avail the benefits of renting products or other assets.
Real-Time Access & Data
If you had to do things the traditional way, using an on-premise solution to manage your rental equipment business might turn out to be more capital extensive than you are prepared for. According to Andrew Heriot of Maximizer CRM, on-premise solutions would need licensing or some sort of subscription, installation, set-up, customization, integration, data migration, data storage, and user training.
Some of those requirements are also recurring in nature, notwithstanding fees for consulting, business process improvement, storage, backups, and other necessary infrastructure.
Why go on-premise when you have the option of going to the cloud? Rental equipment-specific software as a service helps you get real-time access to information, data, and everything you’d need to manage your business better.
Billing, Contracts, & Invoicing
Cash flow is the yard stick used to determine the health of a company, according to Cornelius J. Casey and Normal J. Bartczak of HBR.
Most rental businesses, however, struggle with cash flow issues originating out of unpaid invoices, extended credit deadlines, and more.
If anything, positive cash flow is critical for your business to thrive. The more organized and systematic your billing, contracting, and invoicing processes are, the better it is for your business.
Sererra’s Rental Management Module within NetSuite allows you to rent out items along with efficient inventory tracking, invoicing, automatic balance sheet reconciliation, rental invoicing, contract management, and timely alerts for contract renewal and automated invoice payment reminders.
Mismanaged Inventory is Expensive
Inventory is expensive to keep. Not managing it well is even more expensive.
According to REL Working Capital Survey, inventory (in addition to accounts receivable and accounts payable) accounts for more than $1.1 trillion in cash. Retailers sit on $1.43 in inventory for every dollar worth of sales.
Here’s the kicker: about 46% of small and medium businesses don’t track inventory at all. At best, they resort to manual methods.
NetSuite RentalSeries [https://sererra.com/netsuite-rentalseries/] helps you manage your rental business with real-time booking notifications, multi-location transfers, controlling item availability and stock, orders and re-orders, and more.
For most rental businesses, the pipe dream of automated billing usually doesn’t see the light of day because of difficulty in implementation, dependency on a staggered (and disjointed) set of solutions to achieve the outcome, and the lack of an efficient way to communicate and bill customers.
Renting out multiple items or products to multiple clients with varying times and dates for billing could very well turn out to be a nightmare if not managed correctly.
With NetSuite’s Rental Series, you get access to automated billing features. NetSuite for Rental businesses allows for multiple billing, scheduled billing, and is PCI compliant for credit card processing.
The system is adaptable to any kind of rental business which makes it easy for you to adapt the tool for your specific use-case.
The days of pitching and winning are over.
With a robust content marketing process in place, your business can use intelligent targeting, social selling, automated information inflow for sales teams, and separate and tracked contact management leading to closure. This allows you to have clear expectations on revenue.
Marketing automation helps a streamlined process to generate leads and nurture your potential customers to the point of closure, almost without expending too many resources that are otherwise better used for other areas of your business.
With the NetSuite CRM & ERP base module, you get a 360-degree view of customers along with a seamless flow of information across each customers’ life cycle. Get access to opportunities, sales orders, and support.
Plus, you also get to do upsells, cross sells, and keep track of every customer as they move from prospecting to sales, and beyond.
What do you think are the biggest bottlenecks for your rental businesses? How do you think technology can help propel your business forward? What are your pain points when it comes to implementing technology as the backbone for your rental business? Please comment to let us know.