Rentals Take the Sting Out of Getting the Latest Gear
Although not a rental arrangement, the TechForward buyback program is built to attract consumers who want to keep a product for a while but like to upgrade regularly. Through participating merchants--including CompUSA, TigerDirect, and some RadioShack and Office Depot stores--TechForward BuyBack plans are available with new electronics purchases.
The plan costs $30 with the purchase of a laptop under $1000, or $150 for a flat-screen TV priced between $1000 and $2000. If you tire of the tech toy within six months, you're supposed to get back half of what you paid to buy. The benefit diminishes with time: Between 18 and 24 months from the purchase, for instance, you'll receive only 20 percent of the initial price.
This program could work as insurance against buyer's remorse, but it isn't necessarily a great deal. If you buy a laptop for, say, $800 and take it back after three months, you'd receive $400, so you would have paid about $133 per month for use of the laptop. If you took the laptop back in a year, you'd get 30 percent, or $240 back. At that rate, you'd have paid about $47 per month.
By contrast, if you kept the laptop for a year and didn't return it, the price would average out to about $67 per month. So, if you plan to get rid of the machine within a year anyway, using the buyback option toward a new purchase appears to be a fair deal. But you'd pay a premium to use the laptop for a shorter period of time.
In addition to businesses that provide rentals directly to consumers and businesses, Web-based services such as Zilok, which enables person-to-person rentals of electronics and other items, are in their early stages. Users can offer and seek items in rental categories, including electronics, power tools, and cars, around the country.
Among the items available on Zilok (as of this writing) is an AT&T 3G Sierra Wireless laptop modem, which costs $20 per day in New York. For $15 per day, you could use an electric power washer in Lake St. Louis, Missouri, or a Sony HD Handycam in Chicago. If you want to pose behind the wheel of a late-model Porsche, it can be had for $399 in Massachusetts.
On Rentalic, you can find items in 15 states, with the most available throughout California. A company throwing an event could find golf clubs, folding chairs, and a PA system there. SnapGoods is currently in beta testing exclusively in New York. On that site, people list items for daylong rentals, such as $10 for a toolkit or $20 for a Roland XP-60 music workstation. To rent an item, you leave a security deposit via PayPal, and leave an identity trail via SMS and Facebook.
Lessors and lessees on person-to-person services set the delivery terms of their transactions, either shipping goods to each other or meeting in person to hand off large equipment. The services charge item owners commissions on transactions. For Zilok, that fee ranges from $1 for a $10 rental up to 5 percent plus $26.60 on rentals of $2000 or more.
By frequently renting out expensive gear via one of these Websites, item owners could potentially earn back what they spent on the purchase. Renters pay only the rental fee, but lose their deposit if they break an item.
Do the Math
Before deciding to rent or buy new tech gear, crunch the numbers. Decide how long you really need the product, and what you're willing to pay for it in the end.
Short-term rentals can be a bargain for a few days or weeks, but can quickly stack up if you keep extending the rental. Even so, businesses may find the included setup, delivery, and tech support worth the premium. Another attraction is the convenience of getting rid of gear once it has served its purpose. TechForward, for example, pledges to resell or recycle products that you return.
Consider the hidden costs of ownership, too. If you're planning to charge a new TV or computer to a credit card, what will you have paid in interest after a year? If you're paying a big-box store an additional fee for tech support or a flexible return policy, don't forget to add that to the overall price.
Rentals Take the Sting Out of Getting...