As the event and party season gets underway, we thought now would be a good time to share not only our insights but mainly those of a party rental veteran who has fought the same battles and waged the same wars as many of you. In order to better understand how to determine rental rates for your party inventory, Will sat down to talk the talk and learned how to better walk the walk with Tom Friedman from Got You Cover’d inc. in San Luis Obispo, CA (say San Luis Obispo 10 times fast).
This is an extremely useful video for anyone who has invested in some new inventory for the upcoming season and can’t quite figure out where to place your pricing, but it’s particularly helpful for those brand new to the rental business and in need of guidance when it comes to getting the best ROI.
Tom walks us through pricing everything from plastic and resin folding chairs to wood folding tables and even the wood crates that store your glassware.
If at anytime you want to skip around or in need of a quick read, we provided jump links for you right here:
Plastic Folding Chairs - 4:07
You all know ‘em, you all love ‘em. Some refer to them as “Samsonite” chairs(we call them our TitanPRO Plastic Folding Chair), they are the backbone of our industry and provide a great opportunity to receive some return on investment.
Tom suggests a 10:1 ratio principle on these chairs, meaning you should price to rent at 10% of your purchase price. I needed this explained to me like I’m a 5 year old so here’s an example: a $12 chair should rent for $1.20.
Resin Folding Chairs - 4:53
What’s the rental rate on resin folding chairs? 10:1, just like your plastic chairs. Resin folding chairs are initially going to cost you more up front but it won’t be long before you’re enjoying the fruits of your labor and finding it hard to even keep these chairs in house for a weekend.
Like plastic folding chairs, the resin material allows for little to no maintenance and the inherent polypropylene with UV protectants that are included in the molding process creates one of the most durable seating options in the event industry.
Wood Folding Chairs - 5:03
To the untrained eye, wood folding chairs and resin folding look nearly identical but like Hallie Parker and Annie James in the Parent Trap(shouts to lohan - you're doing great, sweetie) they are anything but interchangeable.
The recommended price point is 15%-20% of your purchase price per chair. Why the increase from resin folding chairs if they look so similar? While the wood folding chair has a more classic and warm feel, it has a cost and that cost is maintenance.
Now, you won’t be in the shop after every event applying paint due to scratches and dents but over time, that sort of labor will be required.
Where you might get 10-15 years out of your resin folding chairs before replacing or refinishing, you’ll most likely only get a 5 year life span out of your wood folding chairs, thus the justified price increase.
Folding Tables - 6:21
There’s no certainly no shortage of folding table brands and sizes out there for you to choose from. Personally, we think our Titan Series™ and TitanPRO™ folding tables are the best bang your buck but I digress.
Due to the variance in pricing for an 8’ x 30’’ wood folding table for example, an 8-15% price point is recommended.
Here’s a pro tip from Tom: He says if he has to choose from a cheaper or more expensive table that’ll undoubtedly last longer, he’ll buy the cheaper table but price it as if it’s the higher end table just because he’ll replace it more often to keep it looking fresh for his customers.
Stacking Chairs - 7:47
Just like those JNCO jeans and Airwalk sneakers you thought would last forever, fads are just as fleeting when it comes to investing in certain stacking chairs like gold chiavari chairs or cross back chairs.
Usually there’s a higher return on investment but they also take up a lot more storage space when compared to your plastic folding chairs that nest together.
To further explain how this could impact your day to day operations, a 24’ box truck can handle about 2000 plastic folding chairs while it can only hold about 500 chiavari chairs. It’s vital to account for all the labor costs and time included with stacking chairs from storage and transport to setting up an event and breaking down.
In short, The best advice is to consider how trendy the chair is, how much space it will take up and price accordingly.
Flatware - 9:20
What might be the smallest items in your inventory, probably demand the most care. With flatware comes counting, washing, bagging and shining before the next event.
With keeping that prep process in mind and amount of necessary care, you should rent flatware at 30-40% of your purchase price
In theory, it seems you’re paying for your initial purchase at a higher rate in 3 or 4 events but there’s a lot more behind the scenes spending in labor, cleaning and maintaining every piece of flatware.
Glassware & Chinaware - 11:02
Same principle as Flatware when it comes to accounting for care and behind the scenes manual labor in handling your glassware and Chinaware.
With glassware, you have to account for breakage by customers and crates that actually store the glasses. In many cases, the crates are actually more expensive than the glasses it’s protecting.
Here’s a prime example: 25 glasses at $3 a glass = $75 in a wood crate that initially cost you $70. So while you’ve covered the cost of the crate, you still haven’t made money on the initial glassware investment, thus the need for a higher rental price for a quicker return.
Check out Part 2 of our video with Tom to find out to the best way to price your linens, tents, staging, dance floors and more!
Tablecloths and Linens - 1:00
A tad bit trickier than throwing down a bed sheet on a picnic table and passing around a box of rose before a Dispatch concert in 2003 at SPAC.
With renting out tablecloths and linens comes unforeseen costs to the customer like stains and tears that need to be accounted for in your price. On top of that, there’s manual labor by your crew involved like a laundry load that can take up to 5 hours to clean.
Much like stacking chairs, certain tablecloths are susceptible to fads. The gold polyester round tablecloth with sequins you rented out for cousin Ida’s fabulous retirement party might not see the light of day for a couple years or even worse, never again(her sister Jeanie complains about her angina acting up but she has 5 more years playing secretary for her brother Danny’s tree company before retiring).
Enough about the Quinn’s of central NY(similar to the thenn’s of hardhome). How do you price linens? It’s best to start at 100-150% of your initial investment for the exact reasons above. It’s difficult to project the usage rate of each tablecloth you purchase so the best practice is to try to get your initial return back sooner rather than later.
Catering Equipment - 2:39
We can get the easy items out of the way first. When it comes to chafing dishes, use a 1:1 ratio. Buy it, rent it, clean it, forget it.
What makes this such a tricky topic is the larger items that fall under the catering equipment umbrella. Convection ovens, warming cabinets, maybe even a popcorn cart - stuff that can’t be easily delivered in a pickup truck. A liftgate is most likely needed as well as 2 of your employees and that’s time that needs to be accounted for.
The guidelines for pricing catering equipment is really on an as needed basis. If you see yourself using a convection oven more than once then buy a quality product rather than a discount, used oven that you might need to replace in 3-5 years.
Patio Heaters - 5:45
The principal we applied to folding tables can mostly be replicated for patio heaters. The worst kept secret about patio heaters if they’re absolutely going to require maintenance. The more expensive heaters might need a little love in 3-5 years while the less expensive models need the same attention every 2-3 years. The bottom line is that maintenance is inevitable, it’s just how soon do you want to deal with it.
Tom suggests investing in the less expensive heater, even though you might have to replace parts sooner. Why? While a 5 year cushion might be nice, the appearance of a new patio heater to potential clients looks even nicer.
Regardless of which patio heater you choose, you’ll want to price them to rent the same. A 50% ROI is recommended across the board. Remember, you’ll have to account for fuel and components and possibly serving a seasonal market.
Want to know a fun fact about patio heaters? You’ll promise to tell everybody? Ok. Ready? EventStable sells them too!
Dance Floors - 8:41
The good news about investing in dance floors for your party rental company is that they should last about 10-15 years.
The not so awesome news that might not have you calling your day trader friend to invest in a starlit dance floor is anytime soon is that they also require some love in the form of maintenance from you and your staff. Hopefully it’s not the norm, but in some cause you may find yourself spending more time on the install and breakdown and cleaning than the guests do shaking a leg and blaming it on the boogie.
With everything that goes into the process, you should price your dance floors at about a 30% return. Not every party you book will be begging for juking and jiving, but when it does, you’ll be priced just right for the market.
Staging - 10:18
You don’t have to polish up staging like a dance floor but the labor is more intensive, as well as it contains more components that you may not charge for like cross bracing and railings.
The best guidance we can give on pricing staging is to start at 30-40% of your initial cost, considering the complexity and all the components that accompany a stage install.
Tents - 11:25
If you’re in the tent game then you know it’s more of a marathon than a sprint. In fact, some folks would probably rather run a marathon in heels on a 20 degree day than think about adding tents to their party rental inventory.
Why? Well, you don’t just buy a tent and get off on running the next. For party rental companies, you need to think about insurance, workman’s comp and maybe unemployment, but let’s get down to brass tax here and get down to basics.
We can say a typical 20’ x 20’ tent is going to cost you $1,500.00, so rent that for about $350 with a delivery charge. Sidewalls are great but those need to be accounted for as an additional cost and don’t forget that you typical pickup isn’t big enough to transport poles that are needed for a 20’ x 20’ tent. Start at 20% of your initial investment and factor up from there considering trends, permits and complexity.
But don’t let this scare you off from adding tents to your inventory! Here’s the rub, Hamlet; having a tent to rent will probably open you up to booking an entire party and that means chairs, tables, linens, dishes and everything that comes with it just because you initially had the tent.
On the flip side, a customer might want a tented wedding and if you don’t have the tent then there’s a chance you won’t be asked to fulfill tables and chairs as well.
In short, tents are a great investment but be mindful of all the hidden costs that accrue over time. Speaking of time, If you're looking to save some and find a better a way to organize those tent tops, take a look at our Tent Tags!
If you’re new to the party rental industry or just need to invest in new inventory that will last for years to come, check out all of our event tables and chairs from EventStable!
