Let’s start with the simplest pricing strategy- 

Cost of product + Profit margin 

Thus, your rent would be 

Rent = Cost + Margin 

The margin is entirely up to you as the owner. Calculating the rent using the above formula will also help you determine the optimal renting duration, where you will reach the break-even point.

Competitive Pricing-

Another approach would be to price your product based on what your competitor is.

If you are an established renter on the Ispick platform, you can rent at the same price as your competitor.

Rent = Competitor’s Rent

However, if you are new, it would be advisable for you to rent at a slightly lower rate.

Rent < Competitor’s Rent

Thus, when it comes to finding what pricing strategy works for you, figure out what your expenses are, the convenience and benefits of the product you’re listing, and your revenue goals. 

Another important aspect of renting is the security deposit. 

A security deposit provides monetary security to the product lister in case of damage to the product. 

When deciding the right amount to list as your security deposit, we urge you to keep in mind that you are renting out pre-owned items. 

Products that you own will typically wear out or depreciate in value overtime. However, we completely understand the value your products hold for you, thus, safeguarding them is a priority for us. 

An appropriately priced security deposit will also enable you to list your product at a lower rent, attracting more customers.

Let’s take a look at how to determine a security deposit amount-

1. One month’s rent:

A very common practice is to charge one month’s rent as the security deposit. This seems like a reasonable and fair amount. 

You may consider collecting a slightly higher amount in case of electronics (which contain add-ons) and expensive equipment.

1. Check the market rate:

You could look into what your competitors are charging for similar products, and list your own accordingly. 

1. Consider your customers:

A higher security deposit may strain your customers’ finances. For example, someone renting furniture might just have moved into a new apartment, in which case they might have a lot of ongoing expenses. Keeping a reasonable security deposit will protect you, but will also build goodwill with your customers.

1. Low risk items:

For products that have depreciated in value (your products are pre-owned and have been in your possession for quite some time), consider a lower security deposit, because you will earn added revenue through rent, and the deposit is refundable anyway. 

In case you have more queries, check out our FAQs page and feel free to reach out to Ispick Support!