Equipment Rental Financial Model

Description
The financial model for an Equipment Rental Business Financial Plan is designed to assist owners and investors in making informed decisions about a Rental Business Case.


How Model Works


Revenue: The rental equipment business generates revenue streams based on forecasting the average number of days a piece of equipment will be rented each month.


Costs: The model includes standard expenses such as repairs and maintenance, salaries, and rent, which are demonstrated through "components" to give the user an understanding of how costs work. Adding, removing, or adjusting costs is a quick and straightforward process that only takes a few minutes.


Investments: Forecasting balance sheet transactions for equipment rental investment can be daunting for those new to forecasting. However, the model takes a simple approach by allowing users to set the percentage of funds from loans, cash, or business equity in the assumptions sheet. This feature provides flexibility, enabling users to set up funding processes (loan or equity) for each rental equipment. The model comes pre-populated with examples of equipment purchases, demonstrating how easy it is to add new assets to the balance sheet.


Comparing Budget to Actual Expenses: the model includes a sheet where users can compare their business's performance against the initial forecast. This feature allows users to measure their performance against the original projections and adjust their strategy accordingly.


Key Features


The financial model is that most inputs are set in the assumption sheets. These inputs include revenue assumptions, capital expenditures, operating expenses, startup costs, and other critical financial data. This user-friendly interface allows users to input data in the blue font cells while the rest of the model uses formulas or labels.


The model is flexible and can be adapted to reflect changes in the business environment or the unique needs of a particular equipment rental operation.


Additionally, there are green sheets that perform auxiliary functions such as financial, debt, and working capital projections, for which users don't need to input any additional information.


The financial model also includes blue sheets, which are output sheets that provide a detailed view of how the business would perform given the assumptions.


These output sheets offer users a comprehensive analysis of financial projections, including revenue growth, gross margin, and net profit margin. Furthermore, the model provides a vast selection of charts and ratios that offer a deeper understanding of the business's performance drivers.


The model also includes an evaluation tab where users can assess their business's valuation and potential exit strategies. This feature is handy for investors looking to sell their stake in the company or for entrepreneurs exploring alternative options to grow their businesses.


The ideal software for using this model is MS Excel, but a comparable version is available for Google Sheets. Please search for the model among the other models available.