Standard Rate Calculation

Rental Vision includes a Standard Rate Calculation that is used to calculate the price charged for any rental item. Below is a description of how this rate calculation works.

 

Minimum Time/Minimum Charge.  These entries must be present for any rate calculation to work properly.  The Minimum Time and Minimum Charge work together to determine the minimum rate that will be charged for a rental.  In Equipment Maintenance or New Equipment, it is required that you enter these items.  There is a Minimum Time drop down that lists the available minimum times.  The Minimum Time is the amount of time that will is allowed for the Minimum Rate.  For example, if you specify 1 Day as the Minimum Time and $35.00 for the Minimum Rate, then the rental item is charged $35 for the first 24 hour period.  After the Minimum Time, the other rates specified will determine the charges for the time after the Minimum Time.  If you specify 1 Event as the Minimum Time, then the system will use the Minimum Rate regardless of the amount of time rented.  This is a common rate for companies that rent to the party and event business.

Daily Rate.  This is the rate for each 24 hour period.

Weekly Rate.  This is the rate for each 7 day period.

Monthly Rate.  This is the rate for each 28 day period or month using the day of the month to the next month on the same day depending upon the system settings.  The default is month to month.

Yearly Rate.  This is the rate for the day of the year to the day of the next year.  If this is left at zero, then the rates will use the Daily, Weekly, and Monthly Rates to determine the charge.

Extra Hours Rate.  This determines the hourly charge.

Process of Determining the Rate Used

The system uses a number of time intervals to determine the charge such as Minimum Charge, Daily Rate, Weekly Rate, Monthly Rate and Yearly Rate.  The system will determine the time of the rental and then progressively look through the rates and charge the lowest rate depending upon the time.  For example, if you have an item that is rented for 3 days, the system will calculate 2 days of rental and compare this to the Weekly Rate.  If the Weekly Rate is lower, then it will charge the Weekly Rate instead of the 3X the Daily Rate.  It is common to set up rates in 3X method where the Weekly Rate is 3X the Daily Rate and the Monthly Rate is 3X the Weekly Rate.  You can determine any method you like for this progression.

When using a Minimum Time of 1 Event, the system will not use any other rate than the Minimum Time.

Here are some examples

Rental time is less than Minimum Time. Charge the Minimum Rate.

Rental time is 2 hours over the Minimum Time and less than 1 day. Charge the lower of Daily Rate and Minimum Time plus 2X Hourly Rate.  If the Daily Rate is zero, it will charge zero.

Rental Time is over the Minimum Time, 2 Days and 3 hours. Charge the lower of 2X Daily Rate + 3X Hourly Rate and the Weekly Rate.  If this refers to the Weekly Rate and the Weekly Rate is zero then it will charge zero

Rental Time is over the Minimum Time, 3 Weeks and 3 Days and 4 Hours.  Charge the lower of 3X Weekly Rate + 3X Daily Rate + 4X Hour Rate and Monthly Rate.

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