Volume discounts in the AV rental business

Woodhouse & Associates website. http://www.woodhouseav.com/

Yesterday I wrote about this firm as an example of someone who understood colour theory. Today I'm looking at their rental pricing model.



Pricing from http://www.woodhouseav.com/pricelist

The discounts are pretty sizable if you rent for longer periods of time. But apart from wear and tear on the equipment, does Woodhouse really have a lot of extra costs when the equipment is out for longer periods of time? Only a few items, such as projectors with limited life bulbs, actually have a measurable replacement cost when they are in use.

And once the equipment is out the firm does not have any costs for additional days. (Apart from the opportunity cost of lost potential revenue.) And the vendor only needs to produce one invoice. A week is almost 1/2 of the cost for seven individual days, and a month is 1/3 of the cost of 30 individual days. (Interesting to see that they charge the same amount for 28, 29, 30, and 31 day months. If you rent in February you are getting up to 10% less for your money.)

But, regardless of whether you think that the rates are reasonable, I give this vendor full marks for transparency. And from the customer's perspective, having a clear idea about the pricing structure makes the buyer's job much easier.