Establishing a successful RV rental business is challenging, especially if you have limited funds to start with. However, there are hundreds of RV rental companies around the world, many of which started with a relatively small fleet and a limited budget. Fortunately, there are many different budget-friendly methods that entrepreneurs can leverage to quickly grow their rental fleet with minimum investment, like RV consignment rentals.
At Wheelbase Pro, we partner with many rental companies adopting different strategies to grow their RV rental businesses in North America, Europe, and Australia, so we’re familiar with the steps that owners need to take to grow their fleets without spending a small fortune.
In this article, we will discuss RV rental consignment and the benefits it can bring to your business. We’ll also go over how consignment RV rentals work and what you need to do to grow your fleet using consigned vehicles.
What Are RV Consignment Rentals?
Before delving any deeper, let’s take a moment to define RV consignment rentals. Generally speaking, consignment is the act of leaving an item with a third party to be sold or rented.
In the context of RV consignments for rent, the owner of the RV leaves the vehicle at a rental business. The rental business owner is in charge of promoting the RV, getting customers to rent it, and handling all maintenance in exchange for a commission on the rental price.
Simply put, RV consignment rental is a great alternative for RV owners who want to make an extra income while giving RV rental businesses the ability to expand their fleet without requiring an upfront investment.
How Exactly Does RV Rental Consignment Work?
It’s important to understand that every rental business is different, so the exact structure of a consignment agreement varies depending on many different factors.
As we explained previously, the idea is that RV owners leave their unused vehicles with rental businesses. Every time a consigned RV is rented, the original owner gets a percentage and the rental business earns the rest of the payment as a commission.
In the vast majority of cases, the rental business is responsible for cleaning, repairing, and maintaining the consigned RVs. This means that the RV owners don’t need to worry about anything at all — consignment literary works like passive income. Moreover, RV consignment is also a win-win for motorhome rental businesses because these businesses can expand their fleets without having to actually purchase new vehicles.
There are many different models of consigned RV rentals. For instance, some businesses take care of attracting customers and completing bookings while the RV owners handle the storage, key exchange, and vehicle maintenance. You can even have a hybrid model where you handle all aspects of the rental for local consignments and attract customers for RVs located outside your usual service area.
Costs and Fees Associated with Consignment Rentals
There is no doubt that RV consignment rentals can help business owners grow their fleets. But, as a business owner, you need to consider any and all additional fees that you may have to cover.
Depending on how you set up your consignment program, you’ll likely be liable to cover cleaning, maintenance, repairs, refueling, part replacements, and even insurance costs. You may be able to mitigate some of these by opting for RV rental software that includes insurance and taking similar steps.
But, you should still analyze your specific case and make sure to include all RV consignment-related expenditures in your budget.
Benefits of Growing Your Fleet Through RV Consignment Rentals
Having an RV rental consignment program for your business is a great way to boost your fleet size without incurring significant expenses. This, in turn, brings benefits like:
Get More Business Without Making a Huge Investment
The first and most obvious benefit of RV consignment rentals is that they can help you grow your fleet size and get more business without requiring a huge upfront investment.
Find RVs Quickly
Instead of waiting until you have the credit or funds to purchase a new vehicle, you can track down RV consignment rentals, pitch the idea to an owner, and get a response relatively quickly.
Cater to a Wider Audience
Not only this, but business owners are usually able to offer vehicles that have special features not shared with other RVs on the fleet. This allows you to cater to a much wider audience, like large families or groups that are looking for vehicles with additional capabilities.
Cover a Higher Number of Locations
One of the best things about consignment rental RVs is that they can be located across different areas, as long as the RV owner is comfortable handling the logistics.
As an RV rental business owner, opening new locations and covering more ground is always a priority, but it’s also very expensive. If you strike the right deal, consignments can become a superb option to expand your service area without skyrocketing costs.
Identify the Best Long-Term Fit
Many people have unused RVs that could be generating revenue instead of sitting in a garage. Through RV rental consignment, you’ll be able to find the best long-term partners that are willing to profit from their vehicles for extended periods of time.
How to Grow Your Fleet Through RV Consignment Rentals
Now that we’ve covered its benefits, let’s take a look at the steps you need to take to take on RV consignment rentals.
Create a Consignment Program
The first step is to create a consignment program and determine the specifics about how you will rent out third-party vehicles. This includes the types of RV you accept on consignment, commission rates, and all other details.
Reach Out to Potential Partners
Once you’ve clarified your business model, it’s time to attract private owners who are willing to consign their vehicles.
This process is similar to attracting customers because you have to identify your audience, figure out how to reach them, develop a clear message, and ensure that potential consignors see the value in your partnership program. If done properly, this step should help you bring in a higher number of owners looking to consign their vehicles.
Set Up the Listing and Rent the Vehicle!
As your consigned RVs start coming in, you need to set up a listing, incorporate the new vehicles into your system, and start renting them out. It’s important to always perform an inspection as soon as you get every RV to ensure it’s safe and in good overall condition.
Ready to Grow Your Fleet? Get the Best RV Rental Management Software Today
There are many steps you can take to grow your fleet, but not many of them are as fast and profitable as RV rental consignment. This is the reason why Wheelbase PRO includes a dedicated feature that allows you to manage consigned RVs, communicate with owners, and send easy-to-understand revenue-sharing reports.
If you want to learn more about how to grow your fleet through consigned RVs, contact our team at Wheelbase PRO and we’ll be glad to help.