SETTING UP YOUR BUSINESS

Starting your own inflatable rental business is exciting, but it can also be nerve-wracking. If you’ve never done this before, it’s hard to know whether you have thought of everything you need.

Here are some things to consider as you set up your rental business. 

OVERHEAD EXPENSES

One of the most appealing aspects of starting an inflatable rental business is that it has low overhead. However, as you get started, you will realize that a few items are necessary for your success.

Vehicle

Any SUV, truck, van or small trailer will work fine. You can usually fit 5 to 6 bouncers in a truck, 4 to 5 in a mini van and up to 3 in a SUV. If you don't own one of these vehicles, you will need to hire drivers to make deliveries for you. 

Each bouncer can be set-up by one person in about ten minutes and taken down in about 15 minutes. If you decide to hire a driver to set-up your units, expect to pay the driver between $15 - $25 per delivery. You will want to have a Driver Contractor Agreement in place to protect you from any liabilities.

Storage

Inflatable units are easily stored at home in a spare room, garage or shed. Each bouncer looks like a large sleeping bag standing on end and only takes up a 2x2 square foot area. You could easily store up to 25 units in one carport off your garage.

Equipment

The only other equipment you will need is a hand truck (with fenders), some sandbags for set-ups, a small vacuum, and a tool kit with a hammer, spray bottle, cleaning solution and a few rags. All of this equipment can be purchased at a nominal cost of under $150.

MARKETING MATERIALS

You will need some initial marketing materials to get your business started. A logo, website and business card are essential, and a brochure or postcard about your services is nice to have. 

However, your ongoing advertising costs will be minimal. Your best marketing materials are your products! Your rental units will get attention whenever they are in use, so make sure your name and phone number are displayed on the front of each unit. The Yellow Pages, and local children’s publications are also good sources of customers.

Remember, the more professional your marketing materials look, the more valuable they will be for your business. Don’t underestimate the power of making a good impression on all those who see your company online or on-site. You will book many of your units through referrals – usually about 60-70% of your business will come through word of mouth.

Download our eBook: Marketing Your Inflatable Rental Business for more information.

CHOOSING INSURANCE

There are three different types of insurance that you’ll need to properly operate your inflatable rental business: liability, worker’s compensation, and property insurance.

Liability insurance is crucial to have in place when dealing with children. In the event that someone gets hurt while using your units, you’ll want to make sure you are protected. Liability insurance also lets you rent your units to venues like parks, schools, and/or recreation centers that usually require you to have insurance in place. You can expect your liability insurance to cost you roughly five percent of your total revenue. 

To obtain liability insurance, you’ll need to go through an inflatable insurance broker who will work with you on obtaining a policy that matches your needs. Your broker will then go through an underwriter to get you the best policy. The amount of insurance you will need may vary depending on your region, but a $1,000,000 minimum is typical.

To make it easier to navigate the quote process, it is best to gather the following:

• A list of all the inflatable units in your inventory
• The dimensions on all of your units
• The dates you purchased each unit
• Proof that you provide training to your drivers and employees
• Maintenance records
• Safety rules that are clearly displayed on all your units 
  

It also helps to choose inflatable units that have an owner’s manual and an installation guide specific to each unit.

You may be happy with the first quote for liability insurance that you receive, but it is always wise to have options. Make sure to get three to four different quotes before you decide. 

CONTRACTS

When renting your units, it is important to have a quality rental contract in place that has been reviewed by an attorney. The rental contract should clearly state the safety rules, and should transfer the liability from the renter (you) to the rentee. At eInflatables, we offer a quality rental agreement for use with all of our units, at no extra cost to you. 

FINANCING YOUR UNITS

Running a business today is not easy and that acquiring the equipment you need to get started can be a challenge. You can purchase your first inflatable units in a few different ways: cash, credit card, or by leasing.

If you choose to lease, you will have two options. An operating lease works like a traditional lease in the sense that you make payments on the inflatable unit, but you do not own the unit. An equipment lease is a type of lease where you make payment installments, but by the end of your payment schedule, you will own your unit. A lease purchase is 100 percent tax deductible.

Most new business owners choose to finance their inflatable units. In order to finance, you will need a business license, a business checking account, and an insurance policy in place.

Financial experts advise that using a business line of credit for your company is a best practice to protect yourself. You should only have personal debt on a personal credit card so that you don’t risk your personal credit rating to pay your company’s bills. If you over-extend your personal credit to fund your business, you may have problems getting financing at a manageable interest rate when you really need it.

Once you finance your equipment, you can pay your financing costs with the money you earn from renting your units. Typically, it takes two or three years to pay off an inflatable – but the best units should last five to seven years if they’re well-maintained. That means if you invest in quality, your units will still be profitable long after they are paid off.

CHOOSING INFLATABLE UNITS

There are a variety of factors that play into how you choose your first units, like where you live geographically, your starting budget, and how many people you have to help you run your business.

However, generally speaking, a combo unit is a great beginning unit. 

A combo unit offers the best of both worlds in the sense that it combines a traditional bouncer (the unit that started it all!) with interactive pieces that will keep your customers busy, active, and entertained for hours. Initially, your target audience will probably be children ages two to nine, and combo units serve this age group well. 

The interactive pieces on combo units may include a climbing ladder, a slide, a basketball hoop, pop-up dummies, or similar elements that keep children amused for longer periods of time than a traditional bouncer would. 

In terms of price, combo units are a little more expensive than traditional bouncers, but the upfront cost pays off fairly quickly. As an inflatable business owner, you can expect to earn on average $75-$100 more per rental (depending on the rental rates for your region) in comparison to a bouncer. That means the return on your investment could be made up in one weekend!

Combo units are great for any region. If you really want to differentiate yourself from your competitors, investing in a combo unit that can be used wet or dry is the way to go. This means you can rent out a water-based combo unit during the warmer months, and rent that same unit dry during the cooler months. 

NEW V. USED

Before you make an inflatable purchase, it’s important to compare the quality, construction, and safety features of each unit you are considering, as they will vary from manufacturer to manufacturer. You’ll also want to consider the pros and cons of purchasing new vs. used inflatable units.

Purchasing New Units 

Although it will vary with usage and upkeep, a well-made unit designed with quality in mind will likely last longer than a used unit. Usage plays a large role in determining the lifespan of an inflatable unit, so if you are looking to purchase a unit that will last several years, purchasing a new unit is the way to go. 

Another plus to purchasing a new unit is that it comes with a manual and a manufacturer warranty. New units are also much safer than used units. 

The downside is that a new unit will cost you more money, and you may not be able to purchase as many as you’d like at one time. 

Purchasing Used Units 

Purchasing a used unit is less of a financial burden, and you may be able to afford several purchases at once.

However, it’s important to remember that in general, a warranty isn’t transferable, so when you purchase a used unit, you run the risk of operating a unit with no warranty. 

There is usually a reason why someone is looking to sell a used inflatable unit. You may never know what the real reason is, and even if the inflatable unit looks practically new from the outside, there could be problems with the unit internally that you may not notice until it is rented.

When you consider your options, purchasing a new inflatable unit carries long-term advantages. Although there is more of an upfront expense, it is the wisest decision in terms of safety, quality, and unit longevity. 

STARTER BUSINESS PACKAGES

If you’re looking to begin your fleet with more than one unit, but would like a package discount, eInflatables has starter business packages available. Our packages that can fit into a wide range of budgets and all offer units that will be a great asset to your rental business in the ‘getting started’ phase.

We crafted our packages with the idea that you could grow your business, save money and satisfy your customers all at the same time. Read more about our Starter Business Packages. 

ACCESSORY ITEMS

After you choose your first units, it’s important to have a few key accessory items on hand. These extra pieces typically give your customers a better experience with inflatable games or interactive units.

Extra Game Accessories

If you’ve purchased sport or interactive game units, you’ll likely have balls, boxing gloves, and helmets to look after. It’s always smart to order extras of these items, as they can become easily lost over time. You’ll want to avoid putting yourself in a situation where you aren’t able to rent out your units because you’re waiting on an order of accessories. Moreover, game accessories can become worn after repeated use, so it’s good to have extras on hand when that time arrives.

Slide Covers

Over time, your slides will become less slick. Friction may cause your customers to stick while riding down a slide, which could be potentially dangerous. Investing in slide covers can help you avoid this situation.

Storage Bags

You’ll be busy shuffling to and from rental bookings, and your equipment can easily become damaged if it isn’t properly protected. To avoid this, you should invest in quality storage bags that are large enough to hold your game accessories securely. Storage bags with rings and nylon straps across the top are best for long-term use.

STARTING TO RENT YOUR UNITS

Now the fun part! Starting to rent your units means that your business will start to make money. Some business owners prefer to stay small with 3-10 units while others want to make this a full-time venture with up to 75 units or more. Build your business at a pace that’s comfortable for you. 

Rental Opportunities

There are countless events and occasions that will be great places to rent your inflatable units:

Typically, 80 percent of business owners who are just starting out will cater to backyard birthday parties. These type parties take place every weekend, so there is  ample opportunity for you to rent your services and market your business in your very own community. 

Once you are comfortable with setting up and taking down your units, you won’t have to stay at the parties for the entire duration. You’ll just need to be there in the beginning, and once more at the end to take down the unit. This gives you more hours in your day to operate your business. 

Eventually, as your business grows, you can start renting to the corporate world. You’ll want to make sure to have a steady stream of contacts before you jump in and sell your services to large businesses, festivals, churches and community organizations.

Keep in mind that primarily renting your units to corporations will likely mean that you’ll need to increase your inventory. Businesses will almost always want to have more than one unit at their events, and they’ll want to have the larger and more cutting-edge units that will set their events apart from the rest. That means having water slides, inflatable games and other innovative pieces in stock and ready-to-go. 

If you’d like to rent your services to the corporate world, you’ll typically need a minimum of three to four units. Unlike backyard birthday parties, you or your staff will need to be at these events for the entire duration. 

Rental Frequency

Once your business is underway, each bouncer typically rents at least 2 times per week. Saturday and Sunday are the busiest rental days but many companies also rent their units out during the week to Preschools and Day Care Centers. With smart marketing, you might rent your units 3 times per week or more.

The busiest month of the year for inflatable rental companies is October. October tends to be the month for back-to-school programs, pumpkin patches, Halloween parties, festivals and major fall events. As a result, you’ll want to make sure your inventory is stocked before the start of this month and that any repairs that need to be taken care of are completed well in advanced of this busy time. 

Rental Rates

Rental rates can vary from state to state and town to town. To determine rental rates in your area, look around at your competitors. What are they charging? One of our consultants can also show you how to determine appropriate pricing for your area, just contact us.

Once you determine the typical rental rate for a bouncer in your area, you can easily set the rates for your additional units. A combo unit will rent for $75-$100 more per unit than a bouncer. Add another $75-$100 per unit for an inflatable water slide. 

You may see that some of your competitors charge half-day and full-day rental rates, but don’t be tempted to use this model. Over time, delivering and setting up the same unit multiple times in one day can become exhausting and it may not be the most efficient use of your resources. 80 percent of the inflatable industry generally rents on a full-day rental basis, and renting for six to seven hours at a time is fairly typical.

As a new inflatable business owner, one of the biggest mistakes you can make is to under-price all of your rental rates on your units in an attempt to put yourself a step ahead of your competitors. This may sound like a good idea at first, but it can lead to disastrous results. Eventually your competitors will lower their rates, and you’ll be caught in a cycle of everyone lowering their rates until no company is making what they need to make in order to stay successful 

If you can effectively sell your services, then it is best to price your rental rates a bit higher than your competitors. Do you have the safest inflatables in the industry? Are all of your units made in the USA? Do you clean and sanitize your units after every use? Do you have brand new units in stock? All of these are things to take into consideration when setting your prices.