The global ecommerce industry is worth $6.3 trillion in 2023. Dominating various sectors and niches, the industry is saturated with millions of ecommerce businesses generating immense profits. However, as the competition gets fierce, it becomes more essential for businesses to capitalize on additional revenue channels. One such revenue generation channel that can help existing ecommerce businesses in boosting their revenue generation is the rental model, where along with selling products, ecommerce businesses make profit by renting products as well.
Why Rental Is a Must Have for Your eCommerce Business?
There are several reasons to add the rental option on a retail ecommerce platform. We have briefed the primary ones below:
1. Increases Revenue Generation
Although you may be generating an impressive amount in sales figures, by capitalizing on the rental model, you can boost your revenue. In addition, with rental subscriptions, you can generate recurring revenue. Some popular items that you can rent out on your ecommerce platform are electronic items, furniture, home decor, dresses, adventure gear, sports equipment, plants, tools, etc.
2. Requires Minimum Investment
While adding the rental option to your marketplace, you only need to invest the bare minimum. This is because you can rent out items to your existing customer base without the need of extensive marketing. Furthermore, you already have a logistics system set up and the same product can be rented again and again. Thus, again reducing your investment.
3. Helps in Entering New Markets
By adding the rental option, you also open your business to rental customers and expand operations in new markets. As you can leverage your pre-existing audience, you get a headstart in the rental market and with adequate planning, can also surpass small competitors within a short timeframe.
4. Attracts Rental Business Vendors
Along with product dealers and manufacturers, you can attract rental product owners and suppliers as well. With both sales and rental functionalities, your new and existing vendors will have complete freedom over whether they want to sell or rent products. Some software solutions even allow you to do both simultaneously.
5. Helps in Customer Retention
By providing the rental option, you can retarget your existing audience and retain them. As they won’t need to visit other ecommerce sites for renting products, you would also be building your brand loyalty.
Know how eCommerce marketplace with sell & rent operations works
Features Required to Enable Rental Operations on your Sales Platform
To successfully add the rental model in your ecommerce business, you will need to integrate the following rental features in your platform.
Booking Calendar: A booking calendar will assist rental operations on four fronts, which are displaying product availability to customers, accepting rental date inputs, preventing double booking and invoicing.
Document Verification: Before renting their equipment, vendors would like to confirm the identity and address of the customer for security reasons. Thus, you also require a functionality to collect and verify all necessary documents on the platform.
Rental Security Management: In case of any product damages, rental security management features will help reimburse the damage costs. These features will include the option to collect, deduct and return the rental security amount.
Rental Agreement Management: Before renting your products, you can levy your rental terms & conditions and get them eSigned by customers on the platform itself. The signed agreement will remain stored in your database.
Late Returns Management: For managing overdue returns, you need features to define late return charges that will be deducted from the customer’s rental security deposit. Likewise, your platform should also notify you of any cases of late returns.
How to Add Rental Features on your Existing Sales Platform?
If you are interested in adding the rental option on your ecommerce platform, then there are two primary ways to integrate the aforementioned features:
If your existing ecommerce solution supports customization, then you can ask your software solution provider to add these features. The cost of customization will vary from $1000-$2000 per feature depending on your country’s hourly development rates. These rates are also inclusive of planning, testing and quality assurance stages.
The other option is to switch to a ready-made eCommerce software with both sales and rental functionalities. Not only will this option be more cost effective but the readymade solution will already be tried and tested so that you don’t face any problems in operations.
See How Sales Plus Rental eCommerce Platform will Look Like
Yo!Rent online rental solution can help you run your eCommerce business like the same as before and in addition, conduct rental operations as well. Furthermore, you can give the option to sell or rent products to both new and existing vendors.
With dedicated rent-centric features including all those mentioned above and even more, Yo!Rent is one of the most advanced solutions that combine sales and rental operations. Below are some reasons to invest in Yo!Rent
Available at one time cost. Meaning, unlike in SaaS solutions, your initial investment remains the same.
It is a self-hosted software. You can either host it on a third-party server or in-house servers as well.
Reduces time to market. Yo!Rent can be easily set up within 2-3 working days.
Fully scalable so that you can add as many products as you want
Let’s take the Example of BigFitness
BigFitness is a US-based gym equipment marketplace that uses Yo!Rent to both sell and rent out new and used gym equipment. Click here to check out its full case study.
Adding rental functionality to your existing ecommerce marketplace is a lucrative business idea that can generate impressive returns with minimum investment. Moreover, it allows you to enter new markets as well, where you can target a diverse audience and increase brand awareness. Lastly, for enabling rental functionality on your ecommerce platform, investing in a readymade solution is more reasonable considering the cost effectiveness and reliability a readymade solution brings to your business.
Abhishek Kataria is a business consultant at FATbit Technologies. He assists entrepreneurs and business owners in developing viable digital touchpoints and marketplaces. Abhishek is curious about exploring and analyzing new business trends and has a keen eye for the latest developments in the eCommerce sector. Apart from consulting, you can find him practicing French and exploring his creativity in Photoshop.