Add Rentals as a Profit Center

The walls of Every Baking Moment in Dixon, California are filled with cake pans. One in the fanciful shape of a set of lips. Another in the fancy shape of the breast cancer awareness ribbon. And one in the shape of—fancy this—a lopsided triple-decker cake.
     The store will sell you any of those pans, but most people rent one and save their buying for the cake decoration supplies. The customers figure they’re unlikely to bake the same particular strangely-shaped cake real often.
     Similarly, customers see benefits in being able to try out toys before deciding whether to buy them. That’s especially useful when the purchaser of a toy—the adult—is not the same person who will be using it—the kid.
     If you don’t currently rent out merchandise, consider introducing rentals as a service to your shoppers and as a source of income for your business. If you do currently rent out merchandise, rethink the most profitable ways to feature your rental center as a place shoppers can try out products and then have an opportunity to purchase a used or new version.
     In doing so, you’re acknowledging that there are at least a few shoppers who see your store as a lending library. You don’t want people purchasing merchandise from your store with the intent in advance of using the items and then making a return with a demand for a full refund or credit. A rental arrangement accommodates the short-term user.
     Rental programs also can benefit your shoppers indirectly. GameStop stores have rental programs to allow their staff to master the games. Serious gamers come to store employees to learn the tips, traps, and tricks. When a GameStop staff member praises a game, the endorsement is coming with the expertise of experience.
     A potential downsize for retailers in maintaining rental programs: If a renter damages an item, you might be in the position of harassing the customer for more money. You probably can get the money, but you also can easily irritate a customer, who doesn’t even get to keep the item.
     The solution? Offer breakage insurance for, say, 10% of the rental price. Done well, rental breakage insurance is yet another profit center for you.

For your profitability: Sell Well: What Really Moves Your Shoppers

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