Calculate daily, weekly, and monthly rates based on ROI and overhead.
Recommended Rental Rates
Daily Rate$0.00
Weekly Rate (4x Daily)$0.00
Monthly Rate (3x Weekly)$0.00
How to Calculate Equipment Rental Rates
Determining the correct price for rental equipment is a balance between recovering your initial capital investment, covering ongoing maintenance, and generating a healthy profit. If your rates are too high, your utilization will drop; if they are too low, you will fail to cover the true cost of depreciation.
The Rental Rate Formula
This calculator uses the Annual Cost Recovery method. The formula is broken down as follows:
Annual Depreciation: Purchase Price divided by the Economic Life of the asset.
Total Annual Cost: Annual Depreciation + Annual Maintenance, Insurance, and Storage.
Break-even Daily Rate: Total Annual Cost divided by total rented days (365 days × Utilization %).
Imagine you purchase a mini-excavator for $45,000 with an expected life of 5 years. Your annual insurance and service costs are $3,000. You expect to rent it out 50% of the year (182.5 days).
Annual Depreciation: $9,000
Annual Overhead: $3,000
Total Annual Cost: $12,000
Break-even Rate: $12,000 / 182.5 = $65.75 per day
With a 30% Profit Margin: $85.47 per day
Standard Industry Multipliers
In the equipment rental industry, it is standard practice to offer discounts for longer terms. A common rule of thumb used in this calculator is:
Daily Rate: Base calculation based on ROI.
Weekly Rate: 4 times the daily rate (giving the customer 3 days free).
Monthly Rate: 3 times the weekly rate (effectively 12 times the daily rate).
function calculateRentalRates() {
var price = parseFloat(document.getElementById('purchasePrice').value);
var life = parseFloat(document.getElementById('economicLife').value);
var overhead = parseFloat(document.getElementById('annualOverhead').value);
var utilization = parseFloat(document.getElementById('utilization').value) / 100;
var margin = parseFloat(document.getElementById('profitMargin').value) / 100;
if (isNaN(price) || isNaN(life) || isNaN(overhead) || isNaN(utilization) || isNaN(margin) || life <= 0 || utilization <= 0) {
alert("Please enter valid positive numbers in all fields.");
return;
}
// Calculation Logic
var annualDepreciation = price / life;
var totalAnnualCost = annualDepreciation + overhead;
var rentalDaysPerYear = 365 * utilization;
var dailyBreakEven = totalAnnualCost / rentalDaysPerYear;
var dailyRate = dailyBreakEven * (1 + margin);
// Industry standard multipliers
var weeklyRate = dailyRate * 4;
var monthlyRate = weeklyRate * 3;
// Display Results
document.getElementById('dailyResult').innerText = '$' + dailyRate.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('weeklyResult').innerText = '$' + weeklyRate.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('monthlyResult').innerText = '$' + monthlyRate.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('breakdownText').innerText = "To cover costs, you need to earn $" + totalAnnualCost.toLocaleString() + " annually across " + Math.round(rentalDaysPerYear) + " rental days.";
document.getElementById('resultsDisplay').style.display = 'block';
}