New customers can be surprised (Pleasantly or Sticker Shocked) when learning of the pricing of used & rental equipment, especially EMC test equipment, which requires a lot of things to ensure things go right for everyone, while being an afterthought in product development.
COMMON PRICING CONSIDERATIONS ACROSS THE INDUSTRY
- MSRP
- Physical Condition
- Market Demand
- Availability amongst other rental companies & dealers
- Rule of thumb for used - 70% MSRP
- Cash invested into an asset
RENTAL PRICING CONSIDERATIONS
- Overall wear and life expectancy
- Risk of damage in transit or by customer
- Labor time to prepare (Lab and Safe Shipment)
- Length of rental (Increased admin costs for short-term rentals)
- Regular rental accounts get favorable pricing
- Achieve customer satisfaction and profitability
WHAT ISN'T CONSIDERED?
Taxes - they are inevitable, so they are baked into our rental rates
Why is there rental pricing on the website for some test equipment models but not others?
Online sales of test equipment has been a tedious test and evaluation process for the ten years we’ve been in business. Published pricing with a product's performance can be correlated to evaluate if a product has market demand. When we determine a rental cost appropriate for the market, we believe customers appreciate that transparency and the ability to order it online.
We are a small company without the ability to constantly monitor rental rates or used test equipment prices, our customers will often let us know if we are off base and allow us to be competitive.
Internal considerations when setting pricing
- Demand by our customer base
- Replacement cost to replenish same or similar
- Performance as a rental asset
- Actual Electronic Performance
- Our ability to service and repair
- Availability of replacement parts or service
- Time for ROI
Not considered?
Warranty - We set out with a 100 day warranty but don’t like doing people dirty. If a unit shows a general failure beyond that, we take it case by case to make things right.
EXAMPLE
It took two years to set the Teseq NSG 435 to the $590/monthly rental rate. It continues to be our most rented model eight years later. There are other factors as to why that is but this is how we landed on it.
When I left ATEC, NSG 435’s cost about 6,000 dollars and rented somewhere between 700 and 900 dollars, can’t remember, their overhead was much more significant, large lab, lots of technicians
We moved the rate up and down online and took into the aforementioned factors, primarily the time to spot check an ESD gun after every rental and recalibrating it every 9 to 12 months. However, we landed at $590/month because this is an attractive rate to most customers regardless of their mindset.