In short: renting out stuff that you own on a consistent basis. This often starts small scale – creating an income stream by renting out tools or equipment that you have because it's a personal interest or hobby of yours. It'll likely be a relatively high-cost item that people are looking to use for one-off occasions and don't want to commit to buying themselves. Think: bikes and scooters, tents and camping gear, audio and camera equipment, party supplies, boats and kayaks, and tools and DIY equipment.
The rental economy isn't about to disappear any time soon. There's clearly a large – and growing – consciousness about the importance of reusing items and cutting down on waste. In this case, that means not buying something that'll be used only a handful of times. For many, ownership isn't essential. It's cheaper and far easier to rent things when they need them; it's also the only real option if you're living in a city and lack storage space. A survey by retail estate provider JLL showed that more than half of millennials and Gen Z customers are willing to rent rather than buy – with the caveat that the products must be ‘well-made’ and ‘trendy’.
There's a growing number of platforms, both generalist and niche, that allow individuals to quickly list their items while handling all the nitty-gritty details. If you have in-demand assets and a little time to dedicate to it, it's a side hustle worth exploring. It's also one that, depending on what you're renting out, isn't too difficult to scale.
Is there demand in your area?
Ideally, you'll be living in a major city and have constant demand. It's worth gauging interest by browsing a few rental sites where you live and seeing if there are similar items already on there. Are they getting regular bookings? And what's the price point?
How much time do you have to dedicate to it?
Though this business model does fall under the term ‘passive income’, it's passive only to a point. Renting stuff out will still involve time demands on you – from responding to requests and customer interaction to looking after your equipment and making sure that it's ready for the next customer. You'll need to decide what your time limitations are. It's common for many apps and platforms to be open 24 hours – which can mean ceaseless notifications and requests. It's good to be disciplined and set specific hours of work, if you can. And what will your turnaround time between rentals be?
What's the best platform for you?
Though more established rental businesses will have their own website and social media channels, it makes sense for individuals to make use of pre-existing platforms early on. They can take care of order and inventory management, online bookings, quotes, invoices and payments. Is your equipment specialist? If so, there may be niche platforms that you can list on. Whichever one you opt for, it's critical that you read the small print. What fee does the platform take? What are its rules? How about insurance policies for damage or theft?
What maintenance and product care will be required?
One often forgotten aspect of this line of business is the care and maintenance required. Whatever you rent out, it has to be in excellent working order when a customer receives it. That means regular cleaning and maintenance – not just when there's a problem. Do you have the necessary skills and tools to look after that side of things?
What information do you need to get across to customers?
Depending on how technical your product is and how complicated it is to set up and use, you'll have to think about what FAQs customers will need answering on demand. Additionally, is training or some form of in-person tutorial required? For example, if you rent out a drone, it would be a risky move to just hand it over without some kind of tutorial.
What photography will you use?
Like any listing website, excellent, consistent photography can play a big part in attracting customers and differentiating yourself from others if you're operating in a competitive sector where customers have choice. You'll need to take some excellent images to highlight your products – possibly including some while in use.
Can you create add-ons?
Are there other products or services that people need in addition to your main product? That might be delivery and set-up (eg, if you're renting out big bell tents), a specialist tutorial or affiliated products that can be rented together. Think of ways to get creative with add-ons and generate more revenue.
Is your plan scalable?
For some, this is simply a side hustle and that's all they ever want it to be. But it's worth questioning whether you want to be proactive about growing the business. That'll obviously entail buying more inventory, devoting more time to it, proactively marketing your offering and potentially even hiring people to help.
1. Booqable is an all-in-one rental software that has some great case studies on its website, which detail how people grew their businesses over time.
2. Cheqroom, an equipment management software, has a range of videos on equipment care – including how to organize your equipment room.
3. The Starter Story website has some great case studies on a range of rental businesses and some ideas of where to start.
Three platforms to watch
• Fat Llama. Founded in 2015, this London-based peer-to-peer rental marketplace lets you rent your equipment out to local people, fully insured. It also has an enterprise function for businesses.
• Rentle. If you want to grow a rental business, Finnish-based Rentle is an all-in-one platform that lets you develop your own brand and integrate its software into your website.
• Quiptu. Niche rental platform Quiptu focuses on outdoor rental gear in Colorado and Indiana. Customers pick an activity (eg, camping) and required dates, and all associated rental equipment is shown.
A version of this article was first published in Courier issue 49, September/October 2022. To purchase the issue or become a subscriber, head to our webshop.