How to Start a Rent to Own Business

hause for rent image by Piter Pkruger from Fotolia.com

With the downturn of the economy, consumers continue to look for ways to save money. In the rent-to-own business, consumers can rent name brand items by paying for them on a weekly or monthly basis. In exchange, the owner usually sells the items for more than it would cost in a traditional store.

Decide what type of rental business to start. Examples of successful rental sectors include furniture, electronics and automobiles. Start with a business plan. Base your selection upon factors such as the amount of capital needed, equipment, merchandise, and long-term outlook. Search for a demand for a particular rental business in your area. Research your competition to find out about business trends.

Decide the terms of your rental agreements. Explore if you will run credit reports on consumers or go off reference checks. Consider if you will rent daily, weekly, or monthly. Formulate a plan for late payments. Find an insurance company to insure your rental items.

Inquire at your local tax office for a business license. Also, ask about acquiring a wholesaler license since the object of your business will be to buy low and sell high. Search for insurance providers.

Search for a location. Find a high-traffic area preferably in a strip mall or shopping plaza. Determine the amount of square footage needed. If possible, hire a real estate agent to look for locations that were formally rental stores. This will help cut costs on the building out budget. Once a location is found, contact your local zoning and compliance department to inquire about additional permits.

Buy your merchandise. Research different wholesalers. Choose the one with the best overall quality, customer service, and client feedback. Consider leasing larger equipment such as trucks to free up money in your budget.

Market your business. Let the world know you exist. Run ads in the newspaper. Post coupons in local discount magazine. Advertise on the radio. Stage a grand opening to promote your store and products.

References

About the Author

Based in Dallas, Kelly Taylor has been writing freelance articles since 2000. Her articles have appeared in "Town Talk" magazine, "Advocate" newspaper, and "Stash Magazine." She holds a Master of Arts in English from Louisiana State University.

Photo Credits

  • hause for rent image by Piter Pkruger from Fotolia.com