Special Tool Rental Company

[ttaMllewoD]

Hey guys,

I've put together a business model and am seeking investors to put together a special tool rental company and wanted to get your thoughts on it.

Would you prefer to rent special tools over buying them?
For the price of a $100 tool, if we rented it out for $25, would that make it enough to make it worth it?

I know personally I hated dropping several hundred dollars on tools I used once... thoughts?

[Maverick1225]

You might want to charge a deposit just in case they don't return it.

[ttaMllewoD]

I've got the cost structure all worked out.

30 day window to use the tool, only pay return shipping, pay deposit up front, once the tool is returned your deposit is issued.

I am starting with BMW tools, then was looking towards moving to mercedes.

[E36BMW3series]

Seek elsewhere, it's really not worth your time as a business opportunity. I'll speak from experience. I have the tools available for rent in my Sig. It does bring in some money to offset my initial investment, however, definitely not worth it as a business. It's more of a little gas in the tank every time you send them off.

You have the people that tell you they will only be a week and 1.5 months later they finally respond to your emails telling you that they are done with your tools. Meanwhile you are pissing off customer B who you told could have the tools after that week guy A had them.

I guess a way to fix that problem would be to have a lot of tool sets on hand. Then you run into having quite a large overhead, and not a whole lot of demand. I haven't received any inquiries for my tools in over 3 months.

If you decide to do it, I'll tell u the vanos tools fit awfully nicely in a USPS small flat rate box and ship for $5 anywhere in the country. It took me a long time to figure this one out. Ends up making it about $10 cheaper to people vs UPS and usually gets there faster.


I've got the cost structure all worked out.

30 day window to use the tool, only pay return shipping, pay deposit up front, once the tool is returned your deposit is issued.

I am starting with BMW tools, then was looking towards moving to mercedes.


Another problem you have is getting money transferred. I use a feeless version of paypal. (Google: Paypal without fees) It works great, but if your doing a high volume of transactions my guess is Paypal would figure out and wouldn't be too happy.

Plus my overall opinion of paypal is that it's pretty useless as far as their support and buyer security.

[ttaMllewoD]

i've worked up the cost to where i wouldnt need to purchase any tools up front

i know the demand is somewhat limited, across the board for car enthusiasts, bmw and mercedes are not the only makers that require special tools. Porsche, Jaguar, Audi, Volkswagen are others among the list.

i was assuming that having to carry more than one tool on hand was expected.

and as for the person who returns it outside the window of time, they are expected to return it or they are not refunded the deposit. Obviously if they need more time they can contact me and ask for an extension.

I understand that there are delays in car projects, because i have done extensive work myself including redoing the clutch in my 540, changing the engine mounts, power steering system, cooling system, as well as an entire suspension overhaul.

also issuing deposit refunds will be taken care of via mail by check.

merchant accounts arent hard to do, every shopping cart comes with an application to set up a merchant account to accept credit card payments

[robmpulse]

I can not see anyway that this would be financially rewarding. Not to the extent that it would make up for the hassle and initial investment of purchasing the tools.

[ttaMllewoD]

What about in the eyes of you, the consumer. Have you ever along your trek of owning and working on a BMW, have you wanted to rent a tool that you'll only use once instead of purchasing it?

[E36BMW3series]

I can not see anyway that this would be financially rewarding. Not to the extent that it would make up for the hassle and initial investment of purchasing the tools.

This. I get numerous thank yous from forum members. They all look at is as a service from one member to another rather than a business. It's a pain in the ass. Don't get me wrong, I am pretty close to covering the initial cost of my tools now, but it's taken a long time and a lot of leg work and emails.


What about in the eyes of you, the consumer. Have you ever along your trek of owning and working on a BMW, have you wanted to rent a tool that you'll only use once instead of purchasing it?

Yeah sure have. But I also wouldn't be willing to pay much for it and not be able to keep the tool. Charge too much and people will just buy the tool. If your really thinking about making this a reality you need to partner with some forums, places that sell the parts, and other things.

Obviously I just ended up purchasing my tools when I did my project. Glad I did too because I will probably buy a project car sometime in the future and need them again.

Another thing to think about, there are threads that show people how to make these tools with a drill and a cutting wheel. It's not really hard to make cheap versions that will get the job done. (For the e36 anyway)

I'm trying to tell you, from experience, that's it's not going to be very profitable because it isn't possible to get it on a big enough scale. (You'd have to move appx 100 units a month to make $2000, and that's a ton of units) Factor in overhead of having 100 units.

Also, don't get me wrong. I've thought about picking up a second set if I found a member selling them for cheap to rent out, but paying full price just doesn't make sense.

If you can get them super cheap you'd have a better shot if you sold them as well. You could also offer a trial and allow them to buy the tool instead of returning it if they liked it.

[EuroSportChi69]

I also agree with the guys who say its not worth it. It seems logical that you could get your investment back, but their does not seem like there is enough money to be made that it would be worth all the time you are spending on this.

Customers will always have complications, such as projects taking too long, other parts on their projects breaking, or things getting lost in the mail. Also it will be hard to get your name out there.

What about trying to have tools at local auto parts stores that DIYers can rent? that might be easier and more productive than over the mail.

[ttaMllewoD]

I understand all of the worries, and i have considered them. I dont expect this business at best to pull in more than 1 or 2 million a year at its cap... however...

bmw on average sells 250,000+ cars per year, the very small population that actually works on them after the four year warranty, plus the shade tree mechanics and everyone else that doesnt want to take up shelf space just to work on their cars for that one project.

I have spoken with an extremely busy import mechanic that seems to think quite contrary to you guys. The truth is that i don't think it would be difficult to advertise, think about car clubs, about these forums, about car guys and just talking about cars all the time. obviously i don't want to charge too much to do the job, and some tools just arent worth keeping on hand but that is all part of the plan i've drafted up.

for example if a tool costs $40 there's no point in even attempting to rent it out.

[gtxragtop]

Make sure the deposit covers the cost of replacement. Make sure that there is a damage clause in place, if they damage the tool, they own it. I'd say rental is 21 days max. After that make it clear in the contract that rental costs will be an additional 25% per week. For example, you rent out a tool for $100 for 3 weeks. If it is kept 4 weeks, then the rental is $125, taken from their deposit. I believe you can make this work, but people will take advantage of you unless you make it hurt their wallets.

Take a photo of the tool at multiple angles before you ship the tool. Note the condition of the tool. Send those photos to the renter. If you get it back damaged, you have proof of "who done it".