A comprehensive overview of pricing strategy for event rental professionals including tips on item pricing, delivery fees, upselling, and more.
Pricing strategy is an often overlooked and oversimplified aspect of creating a competitive advantage for an event or party rental business. Let's go over the basics of how pricing impacts your company's positioning in the market, and how to make critical pricing decisions.
What kind of customers do you want to target? What is the relative quality of your products versus the market? How much value do you believe your customers get from your products? All of these questions, and more, are answered in a series of public statements made by your event rental company. Those public statements are called your prices.
Your event rental company's prices serve as a signal to the market about how your company would like to position itself. Low prices tend to attract a high volume of customers, but with low profits per event. High prices will attract fewer customers, but those events will be more profitable. It will inevitably require some trial and error to figure out the Goldilocks zone for your event rental company’s prices.
There are essentially two ways to determine your prices. You can calculate your costs and desired profits to determine your prices, or you can research the market and choose your prices based on where you want to position your company on the spectrum. Ideally, you’ll use both of these methods to get the best results. Let’s take a deeper dive into what this all means
This first approach doesn’t give you any insight on how your prices allow you to compete in the market, but it will tell you how much you need to charge to run a profitable business. You begin by calculating your break-even point, by adding up all of your costs of ownership. This will include purchase prices for equipment, operating costs, depreciation, etc. If accounting isn’t a strong suit of yours, consider outsourcing to an accountant or event management software.
Once you’ve calculated your break-even point, you can then set your desired profits and set a total revenue goal. For instance, if your break even point is $20,000, and your desired profits are $40,000, then you will need to bring in $60,000 dollars of revenue.
You can then mold your prices around this goal. Let’s say, for simplicity’s sake, that you only have 10 inventory items. They’re all the same type of item, and you’d like to rent each of them out for $60 per day. You’d have to rent each item out 100 times to meet your goal of $60,000.
On the other hand, you could also rent them each for $100, in which case, you only have to rent them out for 60 days each. Either one of these decisions provides its own costs and benefits. What matters most is how well each strategy fits with your brand, your target customers, and the quality of your products. Play around with your options until you find a distribution of prices that feels right for your inventory.
Always remember that prices do not just determine your profits. They also determine who your customers will be, where your company is positioned in the market, and how you will compete with other event rentals or wholesalers. If you want to consider your competition in your pricing decision — which you should — you’ll need to do some market research.
You’ll want to establish a map of your direct competitors in the market. Which companies serve as premium options in the market? How do other companies choose to compete with them? Are there any standard practices that you need to take note of?
This practice will deepen your understanding of the competitive landscape, and allow you to identify gaps and opportunities. For instance, you may notice that you can undercut a direct competitor’s prices while providing similar value in your rentals and service. Or you may notice that very few of your direct competitors can match the level of service that you provide, so you decide to charge just a bit more than they do.
Your situation and competitive strengths and weaknesses in your respective market will always be unique, but this method can help you navigate the competitive environment. From there, you can establish your role in the market to best emphasize your competitive advantage.
Each of these methods has their gaps. You may identify a gap in the market that your company cannot afford to serve. Otherwise, you may charge certain prices to meet your target revenue, only to realize that these prices would position your event rental business as much more high-end than it actually is.
That’s why using both is better, to get as comprehensive a view of your situation as possible, and to gather as much information as you can to support your decision. You will almost definitely adjust your prices over time, but it’s still crucial that you do your homework before implementing your pricing strategy.
When you’re in the events industry, listing your prices can be complicated. Every event is different based on inventory items used, services requested, and any number of other factors that cause prices to vary. This can cause issues when it comes to publishing prices on your website, as you may be nervous about clients thinking the price is a promise, which can cloud expectations. For some, the answer to this issue seems to be not posting prices at all, and to simply have inquiries go directly to your sales team for them to suss out viable options.
The problem now is that you’re paying your sales team to spend a large portion of their time trying to reel in prospects who never had the budget for your services to begin with. On top of that, your vague pricing system now leaves room for prospects to negotiate every nickel and dime out of you that they possibly can. So now you’re bringing in more inquiries than ever before, but your conversion rate is down the drain, and your profit margins are decreasing on each deal as well.
Finally, studies show that buyers are increasingly valuing transparency from brands and that younger buyers in particular are likely to leave a website with no prices listed. In other words, you’re bringing in more unqualified leads, and also losing those potentially qualified. This is why transparency is so important when it comes to pricing in the events industry.
If you want your sales team to waste as much time as possible, just take your price listings off of your website, and voilà. Now they will spend most of their time dealing with price inquiries for potential buyers whose willingness to spend is significantly below your minimum price option. This can become a serious problem that significantly impacts your customer acquisition costs and distracts your sales team from working on more important and profitable assignments. It is better to have your sales team working on a few highly qualified leads than for them to have a backup of leads that are unlikely to convert. Quality is much more important than quantity.
You also are more likely to lose high quality salespeople with this practice! Any salesperson with good sales acumen will not want to waste his or her day answering a price question over and over again. If you want someone who is a great salesperson (or, depending on your industry, an awesome designer or planner) you should be highly suspicious of any employee willing to spend their day doing a basic, repetitive task. They should be yearning to spend more time on upselling, closing big fish, and/or creatively putting together a vision rather than listing prices the way a website could and should.
Neglecting to list your prices could even be losing you business with potential buyers who don’t see a price on your website and decide to look somewhere else instead of taking the time to call your sales team. Listing your prices makes the buying process easy for customers, and will quickly filter out unqualified leads so your sales team can focus on qualified prospects in your consumer base.
Listing your prices on your website serves as one of the first engagements that you create with your customer as you communicate not only your price, but your value to them. This is one of your first chances to demonstrate the quality of your services. Confidence in your prices will show that your company has a solid sense of self-worth, and clearly communicates what you believe your value to be. Let people know the caliber of work that you provide upfront by showcasing your prices on your website.
Lack of prices leave apparent room for customers to negotiate, and it delegitimizes your business. You don’t want customers to think that they can negotiate your price down, or to believe that you might be scamming them by adjusting your prices based on the prospect. The good news is, you can avoid inviting in bad actors and penny pinchers by showing confidence in your prices by posting them on your website.
Concealing prices may bring in more inquiries, but these inquiries will be very low in quality. Customers can quickly determine whether or not they agree with your prices and whether or not you are a good fit for them. The result of listing your prices will be fewer unqualified leads reaching out to waste your time, and more qualified leads reaching out with a reasonable understanding of how the conversation will go. And the result of this? Less time wasted, and more money in the bank.
There is no perfect pricing strategy that works for every single type of event rental company. Figuring out what the right formula is for you will take some experimentation, and there will be a trial and error period. However, once you’ve gotten through that period, you will effectively have increased the efficiency of your sales team and will have made the customer acquisition process much less of a hassle. In order to get there, it is most beneficial to list your prices as the default. Customers will not trust you if you are not open and honest with them from the beginning of the buying process. Secure more loyal clients faster with transparent pricing.
It's understandable that pricing for things like tents and A/V services won't be one-size fits all. You can always add something on your website that states, "Pricing varies based on project/region/holiday" etc. The goal in pricing strategy should be to show that you’re trustworthy, to indicate the value associated with your price, and to avoid wasting time on unqualified buyers. You'll be surprised how much of an impact listing pricing can make! For every one person you lose who thinks it's too high, you may find you gain more who appreciate the ease of the transaction in this fast-paced, digital world.
A comprehensive pricing strategy is critical for the success of your party rental business. Pricing communicates an estimated value of your items and services to your customers and filters out inquiries from customers who do not fit your target demographic. Oversight in this area will cost your company valuable time and money.
Where do most event rental companies have faults in their pricing strategy? Let's take a look at the most common party rental pricing mistakes so that you don’t have to learn the hard way.
Let’s say you’re in the process of determining the price of your delivery services. You calculate an estimated cost per mile based on gas prices, and you know how much you’d like to profit from this service. Is this enough information to determine your price of delivery? No!
What’s missing? You’re paying your crew during the time that they’re delivering these items to the event site. You’re also paying your crew during the time that they’re loading and unloading these items both at the warehouse and the event site. If the cost of this time isn’t included in your price, you will take away significantly from your profits, or even lose money on the transaction.
This is also the case for customized items. Sure, you may already increase the price of customized items compared to standard items because of their added appeal, but your extra hours of work in the customization process need to be accounted for as well. You deserve to be compensated for hours spent on custom products, and this shouldn’t have to come out of your profit.
Your time, and the time of your employees, is worth money to you. After all, you could have spent that time working on other worthwhile tasks and projects. If you aren’t being compensated for your time, as well as the face value of your items and services, then you are short-changing yourself. You need to include the cost of your time when determining the prices of your custom items and services.
Competitors can be a valuable source of information when evaluating the market and figuring out your position in the industry. You may choose to undercut your competitor’s prices to get a price advantage, or set higher prices to position yourself as a premium in the industry. You can also examine what deals and services they offer, as well as their processes, to find other advantages that you can capitalize on.
However, don’t fall too far into the trap of comparing your party rental business to your competitors. Your goal is to stand out, not to blend in. You do not want a copycat business that clones all of your competitor’s strategies. Their prices and operations will be customized to their strengths and capabilities, and it is unlikely that you will be able to compete with them using their exact same strategy.
Instead, use the information that you’ve gained from your competitors to establish a solid understanding of the marketplace, and then figure out how you can compete with your unique strengths and abilities.
You may have a competitor who can set lower prices than you because they have access to powerful event rental software that you don’t, or have created efficient processes that you don’t have the resources to match. However, they may also lack some of the services that you offer, or maybe they don’t have as comprehensive of an inventory selection as you do. This allows you to charge higher prices and maintain a competitive advantage with added value that comes from your comparative strengths.
Don’t view your competitor’s businesses as a blueprint for your own success. Instead, use information gained from their successes and shortcomings to determine how you can compete with them by positioning your own party rental business differently.
This may be the biggest and most common mistake, not only in the events industry, but for businesses across the board. The first and most obvious problem with this approach is that lower prices inevitably lead to lower profits. You will have to work harder to serve more customers just to make the same profits as a business that charges higher prices. Unless you have exclusive efficiencies that allow you to undercut your competitors and maintain similar prices, you will not be able to find success using this strategy.
This leads us to the second problem with this approach. You’re not the only one who’s decided to compete on price. There is always someone who is willing to set lower prices. With competitors constantly lowering their prices in response to yours, you will also be forced to continually lower your prices to bring in business. This race to the bottom will take away from your profits more and more as your costs remain the same, and your party rental business will eventually collapse when you become unable to offset your costs.
However, the biggest flaw to this strategy is in the long term. Prices communicate your perceived value to customers. What customers do you want for your party rental business? Do you want low value customers who will try to nickel and dime you throughout the sales process? Then maybe you should continue competing on price alone and see where that takes you (hint: it won’t be very far).
This is another reason why some people erroneously choose to conceal their prices. They believe that it provides them with the advantage of being able to raise their prices for high-end customers and lower their prices when needed to secure lower-end business. While some scenarios will solicit an upcharge, and some clients will be eligible for discounts, the best approach in the long term is to stick to your baseline price in most situations.
A fluid price will erode trust between yourself and your customers, which will negatively impact the likelihood of gaining repeat business from loyal customers. This also leaves room for customers to negotiate your prices down, which will take away from your profits.
Instead, be confident in your prices. Turn down business opportunities for customers who can’t afford your prices and choose not to scam your valuable customers. They will appreciate your honesty and integrity, and will be much more likely to return to you and spread the word about your great business.
Be consistent and treat your customers properly. This will pay off in the long run in the form of a thriving customer network that fits into your target market. Your goal is to build up a strong business with repeatable processes over time, and part of that process is enumerating the value of your products with a standard price. Stick to your prices, and give your customers the confidence they need to stick with you.
As you’ve learned from these common mistakes, the pricing strategy that you choose will determine much more than just your profits. It will also determine your role in the industry and what types of customers you attract. A single-minded approach on party rental pricing strategy will result in a flawed system that leads to a series of short term gains and then burns out. You need to keep all factors in mind to craft a long term strategy that leads to sustainable success for your party rental business.
Make the best decisions for your business and your customers. Incorporate your pricing strategy into your larger vision for your business and how you would like to position yourself in the industry. If you have more questions about pricing strategy, please read our pricing strategy guide.
Pricing party and event rental items can be a difficult decision, whether you’re new to the industry or an events veteran. There’s a massive variety of items that require different pricing strategies, so we thought we’d put together a list of general best practices for some common event rental items.
We’ll repeat this several times throughout this article, but keep in mind that prices will vary based on the market, seasonality, and what’s trending. Many of these recommendations come from events expert, Tom Friedman, from Got You Cover’d inc. You can click here to watch his full interview with EventStable.
A decent rule of thumb for plastic folding chairs and resin folding chairs is to rent them out for 10% of the purchase price. They don’t require much maintenance, and they take up a relatively low amount of storage space. That being said, be sure to monitor the market, as it may drive the price higher or lower over time.
Wood folding chairs are similar to resin and plastic folding chairs, but they require more touch ups and maintenance, and may not last as long. This means a slight bump up from other folding chairs to about 15% of the original purchase price.
Folding tables usually provide a decent return on investment since they tend to last a long time and don’t require much maintenance. It is fair to charge 8-15% of the purchase price depending on the market.
Stacking chairs include chiavari chairs, crossback chairs, and other stackable chairs. Prices will vary over time as they go in and out of time. You can generally rent these out for slightly more than folding chairs (10-15% of the purchase price), as they will take more time to set up and break down, and take up more space in your storage space and delivery vehicle.
Flatware requires a relatively large amount of labor, as they need to be manually counted, polished, sanitized, bagged, and counted again when they go out for rentals. A single plate may take as much time to clean as an 8-foot table, and this time cost needs to be accounted for. Rent for 30-40% of the purchase price.
Breakage is extremely high for glassware, meaning you will have to replace them often. Crates for glassware can also be more expensive than the glassware they hold, and you don’t receive income for that crate taking up space in your storage. This calls for a rental rate of 30-40% of your purchasing price.
You can also charge 30-40% of your purchase price for chinaware, although you should charge slightly lower for chinaware than glassware. Chinaware does not experience as much breakage as glassware, and they require cheaper crates or no crates whatsoever.
If you rent out tablecloths, you need to be prepared to replace them often, as stains and tears occur very regularly. You may only get 3-4 rentals out of each linen depending on the quality of your laundry service. On top of that, certain prints and colors tend to go in and out of style quickly, so demand will vary. Rent out tablecloths at 100-150% of the purchase price.
Catering equipment is a broad category, and it’s near impossible to come up with a standard rule for some catering items. Chafing dishes can be rented out at 100% of their purchase price, as they are cheap, but may not last you very long.
Bigger equipment is more complex. Large catering equipment may require a truck and a lift gate, as well as several workers to deliver. Some items also require complementary items that need to be incorporated into the price. For instance, convection ovens require propane to be useful. They also take up a lot of space and can be expensive to purchase. Fortunately, these large catering equipment items will last you a long time, so buy a quality product if you see yourself using it multiple times.
You will have to do your own calculation based on your specific costs for these items.
Patio heaters will require regular maintenance, so you can charge as much as 50% of the purchase price. You may also want to consider buying a less expensive patio heater for your rentals. Although it won’t last as long as a more expensive patio heater, a new patio heater will look nicer to your customers anyways, so replacing them often will pay off in that sense.
Dance floor will last you around 10-15 years, which is a long time. The downside, however, is that they require regular maintenance and a large amount of time and labor between installation, breakdown, and sanitization. A good rule of thumb is to charge 30% of the purchase price.
Staging can be very labor intensive, especially for more complex stages that contain a lot of components such as cross bracing and railings. Charge 30-40% of the purchase price for staging, depending on the complexity of installation.
Tents can be intimidating to incorporate into your business. They require a large amount of labor, insurance, and other work related costs. That being said, including tents in your inventory opens up your business to booking entire events, as people may prefer to just deal with one company for their tented events.
Charge 20-25% of your purchase price, not including delivery. You can mark up depending on trends, permits, and complexity, and charge extra for sidewalls and other additions.
Keep in mind that the poles and other equipment for tents may not fit in the same kinds of delivery vehicles you use for your other equipment. Consider the costs involved before adding a tenting arm to your event rental business.
These are all general best practices, but it’s no excuse to avoid doing your own homework. You will inevitably need to adjust your prices based on your own unique costs and what’s going on in the market. These are not hard rules, and varying from them is completely fine.
Do what’s best for you and your business, and if you need more advice on pricing event rental items, click here to read more event rental pricing tips.
Wouldn’t it be nice if you could make 30% more on each event by upselling your clients? Afterall, event rentals are limited in the number of events they can host or manage based on time and inventory, making a few high volume orders much more appealing than several smaller orders. You can make the same or even better profits with less time invested by focusing on the size of each deal rather than the quantity of deals.
But how do you convince customers to submit larger orders? Let’s take a look at some of the best opportunities for event rental businesses to upsell.
Selling packages instead of individual inventory items is one of the most powerful upselling tools out there. Why have your customers browse through your inventory to pick out a few items when you can suggest a bundle of several items that complement each other? This makes for an easier and more enjoyable buying experience for your customers, and allows you to sell them items that they may not have ever considered buying or renting before.
You see packages being utilized much more often than you may realize. Every time you order from your local fast food joint, you are offered to purchase the full “meal” rather than just the single food item. Odds are you get the fries and drink with your burger just about every time.
There’s more value in a larger number of products, some of which might not even be considered very valuable on their own. This is especially the case when low volume items are discounted when included in the package. Your customers get more value and you get more income! Everybody benefits from this strategy.
Now, just imagine how impactful your packages could be if your customers could shop through your inventory 24/7. That is the power of Goodshuffle Pro’s Website Wishlist Integration.
Offering deals to promote certain products is an excellent way to increase the volume of your average sale or rental order by highlighting specific items at a lower price. This can help you move items that are generally low volume, especially when there is a time constraint to the deal, such as on holidays or milestones. This creates a sense of time pressure for your customers to try out more of your products while they can get them for cheap. Customers might not be willing to pay the full price on their first time purchasing the item, and this gives them an ideal window to take a chance on something new.
The only issue with this approach comes from overuse. Constantly offering discounts for low volume items can depreciate their perceived value in the eyes of the customer. You want your customers to enjoy the items you upsell them on so that they will continue purchasing them in future orders. If you offer discounts too often, your customers may not be willing to pay the standard price for the item when the deal ends.
If you want to increase the rate that you move low volume items, we would recommend discounting them in a package—like how fries are cheaper when included in a value meal— rather than directly discounting them. Their value will not diminish when included in a package, because a better deal is part of the package appeal. Additionally, only customers who make large purchases involving your packages will have access to the deal, and these customers are much more likely to be repeat customers who will purchase these items again down the line.
While discounts and deals can be useful tools, be sure to use them sparingly, and only when appropriate.
Upselling directly to your customer during a consultation or sales meeting requires a different approach. It requires some finessing and attention to detail, meaning that before you offer them anything, you need to listen and understand the situation.
When discussing the customer’s vision for their event, pay close attention to their goals and motivations. Knowing your client is the most important step in upselling directly. This will allow you to customize your suggestions to their needs. Are they trying to impress their boss? Are they on a tight budget? What is the tone of this event? Make it clear that you’re on their team, and that you want their event to be as amazing as possible!
This insight and mindset will allow you to customize your suggestions, and therefore, their experience. Have ideas and pricing ready for them, and make suggestions that seem intuitive and are difficult to reject. The key here is precision. Find the right moments to upsell and make the most out of those opportunities with well thought out options.
Don’t try to convince them that it’s worth the additional cost. Establish yourself as an ally that is doing everything possible to maximize their experience. This tone allows them to relax and become enthusiastic during your meetings as you go back and forth with ideas. Not only will you sell more, you will also provide your customers with a much better experience, as they will be more confident in the end result.
Always remember that the success of your business depends on the success of your events, and more specifically, your customer experience through all of their interactions with your business. There is no point in pushing items on customers that they do not want or need. This will only push them away. If they leave an event regretting spending money on an item that you recommended to them, this will reflect poorly on you, and they will be less likely to return.
Any time that you attempt to upsell customers, whether it be directly, through deals, or through packages, be sure that your offerings are valuable to them. Upselling is not about renting out items that no one wants originally. The purpose is to delight your customers with products or services of yours that they were not aware of before so that they begin purchasing or renting those items every time they come back to you. Your customers should thank you for upselling them. If you maintain a customer-centric mindset, you will find success in your upselling endeavors.
Delivery fees can be tricky. Since a delivery fee often can’t be calculated until after the rest of the order is finalized, it's a common opportunity for customers to complain. This can be incredibly costly to your business in terms of disputes, reviews, and money if your delivery fee is an estimate without solid grounding to back it up. To avoid these potential damages, it is best practice to set a standard for calculating your delivery rate. Here are the 3 most popular methods for calculating the charge for delivery for event rental professionals:
You can view this flat fee as a charge to rent the truck, and base it on 1) how many trucks you own, and 2) the estimated opportunity cost. Mileage can be determined by calculating the cost of gas plus the cost of your driver and crew’s time. It is up to you whether your crew’s hourly rate will be the same or less while traveling than their regular hourly rate. Your crew’s time should include transportation time as well as loading into the truck, unloading at the venue, reloading the truck, and unloading back at the warehouse.
The hourly fee for your crew should be the real rate of pay for these workers, not just their hourly rate. This will include their hourly rate plus any additional fees to come with compensating your employees, such as insurance costs, benefits, taxes, payroll fees, etc.
You may need to talk to your accountant, bookkeeper, or anyone else who plays a similar role for you or your business to calculate an hourly average for each of these costs to find your real rate of pay. This may vary from worker to worker, and it is up to you whether to base your fee on your highest-paid worker or an average of all of your workers’ real rates of pay.
Charging a flat fee by zip code allows you to charge based on distance and traffic density for each area you deliver to. This ensures that the delivery fee will grow as the travel distance increases. This can also be useful as city deliveries may take longer than deliveries to less populated areas that are a similar distance from your warehouse, as your crew will likely have to sit in traffic for a while.
For instance, delivery to Washington DC may take longer than delivery to a slightly closer neighborhood simply because of the heavy city traffic. In this case, charging based on mileage alone does not account for your cost of delivery. Setting a price based on zip code will ensure that you are properly compensated.
Goodshuffle Pro software will automatically override delivery fees for these specific zip codes. This means you can charge for mileage, but make an exception for a city where you want to charge more due to traffic, or less because it's a place you travel to often and easily.
Another method would be to calculate your delivery fee as an additional percentage of the total order cost. This is a very simple method that may not account for your exact costs incurred during the delivery process (may be slightly higher or lower in different circumstances), but it will charge a larger amount for larger deliveries.
If you choose to use this method, be sure to include a minimum delivery fee. Small orders require less travel time and gas, but they do not take away from your workers’ hourly wages. This is important to ensure that you are properly compensated for your services.
When it comes to delivery fees, being as exact as possible will work to your benefit. Clients love to complain about delivery fees, so including a statement on your website back up your price is the best way to move past those complaints. A truck full of rental supplies is no good to them without workers to deliver them. Your crew deserves to be compensated for their work.
If your client does not understand that, do not be afraid to educate them. This will ultimately help them to understand the value that your company provides. A great way to communicate this is by providing a delivery price breakdown on your website so that your customers can easily break down the value that you are providing to them in order to justify your price. Don’t let an ill-conceived delivery fee pricing strategy cost you time and money.
One of the most common complaints that potential customers make to businesses in any industry is that their prices are too high. Customers want what the company has to sell, but say that they aren’t willing to pay the price for what it’s worth. When the company stands by their prices, the customer goes to a different company with cheaper prices. Does this story sound familiar?
Losing potential customers can send an event company into panic mode, especially if they’re just entering the industry. They may respond by lowering their prices or offering discounts left and right to prevent prospects from turning to a cheaper alternative.
We propose an alternative solution: let those prospects walk away, and let the competition be cheaper. Here’s why:
Let’s assume that you do choose to lower your prices to undercut your competition and please these prospects. You now make less on each deal, but that’s fine because you’ll bring in more business… right?
That may be true for a short period of time, but your competition will catch on, and someone out there will offer even cheaper prices. Then you have to lower your prices even more to stay competitive. This pattern will continue on and on, gradually chipping away at your profits until you aren’t making any profits at all. This will drive both you and your competitors out of business in due time.
This phenomenon is called “the race to the bottom”, and it’s never a good strategy to find success in the long term. There will always be someone willing to drive their event business into the ground faster than you. It’s a game of chicken, and it’s not the position that you want your company to be in.
If you continually slash your prices to compete purely on a price standpoint, you have chosen a target market of the cheapest possible customers. These customers are not loyal to any business or brand. They are only loyal to the lowest price.
This is no way to build a loyal customer base, as they will leave you without hesitation for a better deal, even if it provides less value. Repeat customers are the best way to maintain steady income for your event business, and these customers are extremely unlikely to provide that for you. Wouldn’t you rather target customers who love you for the value that you provide, are loyal to your brand, and spread the word about your business?
Even if you do succeed in bringing in more customers with your cheaper price, this may still have a negative impact on your business. You are limited in the number of events you can host or manage based on time and inventory. Do you really want to spend more time on more events just to earn the same profits that you could get from fewer, higher quality events?
In the events industry, it is much better to have a smaller quantity of events of higher quality. This allows you to focus on knocking your events out of the park every time, and prioritizes your time and resources on projects that could have long lasting positive effects.
Still worried that you won’t be able to find customers with your higher prices? Don’t be. There are always people willing to pay a premium for a better experience. VIP seating at concerts and conferences are always the first to sell out, and there’s a reason for it.
People don’t buy products. They buy the satisfaction of fulfilling a want or need. Would you rather fulfill the needs of customers who want a cheap event or an outstanding event? It’s your decision, and it is reflected in your pricing strategy.
Customers who want a really great event aren’t turning to the cheapest possible option. They’re looking for the best fit and the highest value. It is much more productive to focus your energy on increasing the value of your offerings to target these high value customers. Otherwise, you will be stuck serving low value customers, who will not provide nearly as much benefit to your company.
There is little to no value in the race to the bottom. It’s a short term approach, which isn’t appropriate when your end goal is long term success. Focus on your UVP (Unique Value Proposition) and get in tune with your target market. Empower your market by identifying and amplifying your UVP— learn how here.
Don’t let cheap prospects convince you to lower your standards. Let your competition be cheaper, and be confident in your prices and your value. If they match, you will find the right customers and they will be the key to success for your business.
Event rental software optimizes your organization, decision-making, and implementation aspects of event rental pricing and upselling strategies. Why spend your limited time gathering data, making reports, and handling customer inquiries when you can let software do it for you?
How can software help optimize your event rental pricing strategy? Let’s talk about it.
Running a business without reports is like driving to a new destination without navigation. Embrace reports and let them guide your event rental business to success. Event rental pricing strategy decisions require precise knowledge of revenues and inventory utilization, and that’s exactly what you get with Goodshuffle Pro.
Goodshuffle Pro financial reports provide you with all of the information necessary to make sound pricing decisions for your event rental business with clear, easy-to-understand reports and dashboards. You’ll know where and when you make the most money so that you can plan your campaigns around your most profitable items, seasons, or events.
Utilization reports also help business owners know when to purchase more inventory, when to push items that are being underutilized, and when to retire items that have run their course. It's easy to know what's underperforming so you're not paying to store inventory that's not earning its keep. You'd never let a tenant stay for free in an apartment, nor should you — as the landlord for your inventory — let items take up space on your shelves that aren't earning you money.
Goodshuffle Pro enables you to set individual pricing for daily rates, hourly rates, purchases, and flat fees. This adds an aspect of flexibility in your rental options, and you can optimize and experiment with different rates using your utilization reports to assess whether your inventory is working for you at its current price or not.
The ability to price a package by the contents included will easily let you see the cost of the individual items - then you can make the decision as the business owner if your clients get a deal for booking everything! If a client wants to add something to a package, then the package total will AUTOMATICALLY adjust.
For instance, the image above shows a package with contents that could be individually rented out for $520, being bundled together and priced at $350 for a full day rental. Why give discounts on larger package deals like this? You’ll bring in more large events when you incentivize large event deals. At the same time, you’ll delight your customers, and maintain a strong and flexible pricing strategy.
Once you've made the crucial decision to put pricing on your website, a good event rental software will not only integrate your inventory with your website but allow you the freedom and flexibility to present this information to your clients however you'd like.
Goodshuffle Pro’s Website Wishlist Integration is the ultimate tool for upselling and creating price transparency. This tool allows you to never say no to a potential client by allowing clients to browse your inventory 24/7, quickly build a list of everything they desire for their next event, then send it off to you for approval!
If and when you choose to change your prices, with Goodshuffle Pro’s Website Wishlist Integration, those prices will instantly and automatically update on your website, eliminating any discrepancies between your price listings and actual prices. This maximizes the transparency between your event rental business and your clients, as they will always have the most accurate and up-to-date information.
This enables a whole new level of interaction with your customers, as it’s fun for them to build their own orders while browsing through your inventory, while you get to save time and energy from having to manually translate information from a client's inquiry to a new quote since Goodshuffle Pro will do that for you. If a client isn't sure exactly what they need from you, they can still submit their information to you and move forward. Qualified customers will always have easy access to you and your price information.
With the Website Wishlist Integration, you can create upselling opportunities by offering basic packages that include just the essentials, and an upsell option that includes the centerpieces, table numbers, and all the extras you can earn a little more money on (like this). You can even take this a step further by providing a “budget”, “standard”, and “luxe” option for your packages (like Render offers on their site, see: “bare” packages vs “styled”)). This enables you to hit a lower price point for budget clients, while still providing a full scope of services for clients who want everything you can provide.
The Website Wishlist Integration delights customers, as they have incredible access to your company’s offering and are given a more enjoyable shopping experience. At the same time, event rentals that utilize the integration see an average 30% increase in order size. It’s a win-win!
Good rental software makes a profound impact on the effectiveness of your pricing strategy efforts and allows you to make educated decisions based on real data. You don’t have to guess and hope for the best anymore.
Work smarter and more efficiently with your new best friend, Goodshuffle Pro.