With production budgets tight, filmmakers are looking for creative ways to reduce shooting costs. This blog entry is not really about budgeting, but rather how discounting in equipment rentals works; what to expect and what not to expect.
Discounts on rentals can take several forms all with the ultimate goal of reducing the total number of dollars spent on a particular equipment rental order. Presented here are the various category of rental discount, who qualifies for a particular type of discount, and what form the discount may take.
Some discounts are transparent to the renter but are actually integrated into the invoice. One example of this is THE WEEKEND RENTAL. Pick-up your order Friday and return it on Monday. Typically, rentals houses will bill this as one day. Pick-up times vary but are usually around 3:00 o’clock PM, with return before 10am on Monday.
Actually, the weekend rental has been discounted already. The opportunity to use the equipment begins Friday night after the equipment is picked up and, if you so desire, you can shoot right up to 10am Monday morning. That would be 3-1/2 days for which you are billed only one.
Booking and pre-paying a shoot that goes over several weekends can be a good idea. It locks the gear and the order in, and you can try to get some additional discount. A bird in the hand, so to speak. Realistically, it still a weekend booking, and the pre-pay thing can prove very tempting to the rental house. “A Bird in the hand” one might say.
We often speak in terms of USE DAYS. Let’s say you are shooting Saturday and Sunday. That would be two use days. Billing would still be one day. This would mean the equipment is experiencing use at twice the level the rental rate was intended to address. Naturally, this takes it toll on the equipment by reducing its useful live, or increasing the service and maintenance costs. We do understand that it’s yours to use while in your possession and generally do not define the billable days by use days, but since the gear is being used at 2X, a discount may be harder to get.
HSR RENTER – COME ON DOWN
At HSR, if the order is prepped, checked and ready to go, and it’s only 10am, come-on down early and we’ll get you out early. Having six orders going out simultaneously at 3:00 never made any sense to me. I like a more gradual pace. But you will have to deal with and respect other rental company’s policies. They make you sign a Rental Agreement to that effect. Please read it as it contains all the information you will need to know when working with that rental company. Some (nameless) rental firms will automatically charge you at 10:01am. If this their policy, it’s best to know up front.
Return times also vary. We would love to get all the gear back between 10am and 12noon, reality is when it gets here, it gets here. The only time a late return is a problem is if another renter is in the store and had been told it their order, some or all of which is in your possession, is not ready for them. If we know in advance of a early pick-up request by the next customer, we will let you know during the booking stage. We’ll also call you to check on your return time status should you be late. You if get a call from us, then someone is either waiting, or is on there way in to pick-up. Otherwise, we won’t bother you.
On any given day, if your return time is 10am and we don’t get the return until 4:00 or 5:00 that evening, we may have to bill you something. It’s always best to call us with any delays in return. We got a heart, anddon’t want you in a car accident or getting a ticket. We appreciate the notice call very much, and it generally assures you that you won’t be charged an extra half or full day.
Free days within the confine of a term rental are called a TRAVEL DAYS. These are the days the gear is actually in transit either to the event, or away from it. Local and in-town shoots have a greatly reduced amount of travel time for obvious reasons. We have a policy that travel days can not exceed the billing days. Here’s an example why that is:
We rented a small package (camcorder, tripod, LCD monitor and a wireless) to a person that was doing an interview of a famous person but was shooting in Milan, Italy. No problem, our gear goes everywhere. She picked up her order and went directly to the airport. This was on a Friday. Her rental arrangement with us was that she would be staying on in Italy and that FedEx would be transporting the order back to us (at her expense) so that we would have everything back by the next Thursday.
She said she would only be doing the one important interview and an hour of pick-ups; one day use at the most. As a courtesy, we billed it as a 2-day week giving two travel days on both sides of the rental (totaling 4 travel days).
NO GOOD DEED GO UN-PUNISHED
She shot her interview, packed the gear back up and brought it to a FedEx authorized shipper, paying for International Priority back to us. The shipper did as requested, as far as we can tell, but international shipping is not always particularly expeditious. When the order was late to return, we called the telephone number she provided but couldn’t even get a ring. Just dead.
It took twenty-one days for us to receive back the equipment, apparently stalled by various customs paperwork and practices, bills of lading, value and description, manufacturer’s country of origin, etc. The lady comes back into the store two Friday’s after her original order to re-rent the same package. We advised her that the package has not yet been returned to us, and that we had tried in earnest to reach her. She indicated that she had only returned the prior evening and that her cell phone didn’t function in Italy. We told her that we would call her upon its arrival back to us, which was, as it turns out, the next day.
We called her and told her everything made it back in, but there was some additional charges for the three weeks the equipment hadn’t been returned. She was not pleased at this. Even though we had discounted the carry-over order to a greater-than-usual level, she felt she should only be charged for one day total, not even the agreed upon two days, and certainly not the full month the equipment was out of the store. She suggested we bill FedEx because it was their fault.
Perhaps it was partially FedEx’s fault, but ultimately the renter is responsible for the safe and timely return of rental equipment. If someone is going somewhere outside of their shipping experience, they should inquire and be well advised in making that shipping decision. She just put it on the conveyor belt and assumed everything would be OK.
Even though she had only one use day, the equipment was away from us 30 days. She paid the additional six days, and has a new found insight into matters of international shipping. Frankly, she was lucky it got back to us at all.
TYPES OF DISCOUNTS
Discounts can be calculated by several methods. The easiest discount is by percentage. By way of example, a qualifying student, working on a student project with the blessing of their professor and possessing a Certificate of Insurance from that school, and school’s letter of attachment acknowledging it as a school project receives a 15% discount from the published rate card. Students shooting outside of the schools knowledge, or students that are shooting for profit (their profit) may not always receive a discount.
Other rental firms generally receive a 30% discount from our rate card. Employees receive a 50% discount on equipment rented for their personal projects. These figures are, at best, averages. There may always be a special circumstance that management can make an exception for.
Non-profit organizations may or may not receive a discount. We look at their requests on a case-by-case basis.
Another type of discount is a reduction in the rental days. If the rental company normally books a three day week on a particular item, and they give you a two day week instead, you have in effect received a 33% discount.
THE RENTAL HOUSE DOES NOT CONTROL YOUR CALL TIME
If your LP wants everyone on set at 5:00am on Monday, that’s fine, but realize you will need to pick-up any equipment on the Friday prior. It will sit Saturday and Sunday but that’s unavoidable, and the production will be billed for that time whether the gear is in use or not. The only way a rental company generates income is by billing for equipment when out of and away from the store. Take this into account when setting your schedules. Start Tuesday instead.
If that’s impossible, we here at HSR came up with the 1-1/2 day billing. Thursday through Monday bills 1.5 days. So does Friday through Monday. Standard pick-up and return times do not change. Under certain circumstances you may wish to spend an extra $100 and get a weekend open. It may, depending on the type and size of your order, save you money. The weekend open fee is paid in cash to whatever rental tech I can talk into getting up early Saturday or Sunday to open for you. Weekend opens are between 7am and 9am by prior arrangement only. If you bring some coffee and donuts it could couldn’t hurt.
Late pick-up or returns function similarly. We close at 6:00pm sharp, but if we have to stay open later please call us. Late opens means we have to pay a tech 1.5x for over-time, at best, this is a break even proposition for us. But if you need that service – it’s available.
DISCOUNT BY NO TAXATION
If you have had the opportunity to read some of my other blog’s, the one regarding tax-on-rental deserves a second look. Simply stated: Rental firms that charge tax on rentals (knowing they need not ever do so) should advise you in advance to accommodate the nearly 10% surcharge on your rental fees. You can pay the other 10% or reduce your order by 10% to accommodate the tax and stay in budget. What important piece of equipment are you not taking? Perhaps simply avoiding them is the easiest solution. Or talk them down the 10%.
If you are a professional user, and rent on a regular and frequent basis, your discount can be fairly high, and in certain rental situations up to 50%. The regular pro renter is very desirable to a rental firm. A good group of working pros can make the difference between success and failure.
Customers that come in once a year to rent a PA system for their weekend Christmas stage play break my heart. I want them to have it as cheap as possible, but there is only a thin line of opportunity to get them a great deal. The gear is already in extreme demand that time of year, the movie industry is largely on hiatus (read: no movie or TV rentals) and we risk running out of mics, mic stands, Anchors, wireless and all the related stuff anyway. Despite this, we will try.
THE BEST DISCOUNT IS TO START LOWER TO BEGIN WITH
I hope you’ve had the opportunity to review our rate card. If you have, you’ve probably noticed we’re pretty cheap. If another rental firm is lower, we will meet or beat it (with some exceptions: See our LOW PRICE GUARANTEE page).
A discount on every item we carry has in essence been pre-built-in. What gets us into trouble is when we run out of something. Most rental firms are (well) over 30% higher in their rate than we are. We only get a 30% discount, so if we do run out of a popular item, and we have to sub-rent it, we may not be able to give you our book rate. We will tell you in advance, get your approval and pass the item along to you at our cost. At least you will still be getting a great value. We promise the lowest price, but we do not promise going out of business getting there. When this happens, and it is pretty rare, we beg your understanding.
The only way a rental company brings in revenue to operate is to bill for equipment while the rental item is out and away from the store, whether it is being used or not. If you were to rent a car from Enterprise (or any car rental company) and you let it sit in your driveway for a week, upon its return the car rental company is going to bill you for that week. You could tell the “I only used it one day”, but generally that plea will fall on deaf ears, as they too only generate revenue when their rental car is out and away, driven or not.
I’ve sorry to have droaned on so long on a single subject, but I’ve had 20 years to think about it.
If all else fails, ask.