I probe that you might be a rental business owner. In light of this, you are here to grab knowledge about KPIs for rental startups.

Yes, it’s very essential to have better information about your business KPIs, because it will assist you in which part your business should concentrate on and more. 

In this article, we will explore the KPIs for rental business in detail, by discussing their significance, calculation methods, and how they contribute to measuring and driving your business growth. 

Let’s move on… 

What Is KPI? 

KPI stands for Key Performance Indicator, it is a tool for estimating and evaluating the growth of business. KPIs serve as vital signposts, allowing businesses to assess their performance, identify areas of improvement, and make informed strategic decisions. 

Hence, it is crucial to have quantifiable metrics that provide insights into the progress and success of a company. 

With the above importance, let’s see the KPIs briefly that are required for the rental business. 

Top KPIs For Rental Business

The right selection of KPIs varies depending on the industry, company size, and specific goals. However, several universal KPIs serve as valuable indicators of business growth across different sectors. The general KPIs are,

  • Revenue growth rate
  • Gross profit margin
  • Customer acquisition cost 
  • Customer lifetime value 
  • Customer churn rate
  • Return on investment 

To dive deeply, we need to discuss the core KPIs involved in the rental business. They are divided primarily into three segments. 

Financial KPIs

  • Debt to equity ratio
  • Aging accounts receivable
  • Rental rates and revenue generated
  • Financial utilization

Sales and marketing Business KPIs

  • Change in rental business value
  • Rental growth
  • Customer acquisition cost
  • Marketing revenue attribution
  • Traffic to lead ratio

Customer satisfaction KPIs

  • Customer lifetime value
  • Social media engagement
  • Net promoter score
  • Customer reviews
  • Customer churn rate

By monitoring these KPIs, you can evaluate the business in the factors of financial performance, customer acquisition and retention, operational efficiency, and overall profitability. 

Let’s examine this closely to gain a brief understanding.

General KPIs Common For Businesses

Revenue growth rate

The revenue growth rate is a calculation that refers to the improvement of a company. It is the estimation of total revenue over a specific period of time. This growth rate is commonly expressed in percentages and it will assess the company’s value whether it is growing or declining. 

The formula to calculate revenue growth rate is,

Revenue Growth Rate = (Current Revenue – Previous Revenue) / Previous Revenue) * 100

Gross Profit Margin

It is a financial metric to measure the profitability of a company’s key operations. It involves calculating the ratio of revenue remaining after deducting the cost of goods sold (COGS). 

Gross Profit Margin = (Revenue – Cost of Goods Sold) / Revenue x 100

Customer Acquisition Cost

It is a cost that refers to the total amount of money a business consumes on sales and marketing activities to acquire a new consumer. It represents the total expenses incurred by a company to attract and convert a prospect into a paying customer.

CAC=Total marketing and sales expenses/Number of New customers acquired

Customer Lifetime Value

It is an entire value of a customer that he brings to your business over the duration of a relationship with your company. It indicates the net profit generated by a customer throughout the lifecycle of his journey with a company as a paying customer. 

CLTV=Average purchase value x Purchase frequency x Customer Lifespan

Customer Churn Rate

Customer churn rate refers to the value of the customers who discontinue their relationship with a company or stop using your marketplace suddenly in a certain period. It measures the rate at which customers churned from a company’s consumer base. 

Churn Rate= (Number of Customers lost during a period/Total number of customers at the beginning of the business period) X 100

Return On Investment

It is the core factor that is used to evaluate the profitability and effectiveness of an investment. It quantifies the earnings or returns derived from an investment in relation to its initial cost. 

ROI = (Net Profit / Cost of Investment) x 100

The above KPIs could be applicable to all businesses, that includes rentals too. In this article, I’ve listed and explained the significant KPIs that specifically need for your rental business. 

Top 5 Financial KPIs For Any Rental Business

Debt To Equity Ratio

It is a financial metric used to estimate the capital structure and financial leverage of a business. In the rental business, the debt-to-equity ratio measures the allocation of debt and equity capital utilized for the operations and investments of the rental properties.

Debt-to-Equity-Ratio= Total Debt/Total Equity

Total Debt-the outstanding debt obligations of the rental business, it includes long-term loans and mortgages. 

Total Equity-The ownership or shareholders in the rental business includes earnings and contributed capital, like how much your financial usage is. 

Aging Accounts Receivable 

It is used to assess the timeliness of customer payments and the potential risks of bad debts. By analyzing this you can explore the outstanding receivables and can identify the potential cash flow issues. 

It also indicates the total amount of money owned by the consumers in each category. Via this, you can explore the trends, and potential collection issues, and can keep a healthy cash flow. 

Rental Rates and Revenue Generated

This key performance indicator evaluates the aggregate revenue generated from rentals within a defined timeframe, typically on a daily basis, in comparison to the total rental revenue paid and rented during that specific period. 

It enables the comparison of results across various timeframes, such as daily, monthly, quarterly, and yearly, to establish benchmarks and track performance.

Financial Utilization

It is the crucial part of the rental business KPIs that scale the efficiency and effectiveness of financial resources. This financial utilization will measure, 

  • Asset Turnover Ratio
  • Working Capital Ratio
  • Gross profit margin
  • Operating expense ratio

By monitoring these, you can easily identify areas where you have to concentrate more, certainly on making financial decisions. 

Top Sales And Marketing KPIs For Rental Business

Giving high priority to marketing the business will lead you to a high sale conversion ratio, that drives your rental business growth too. 

Let’s read the KPIs for sales and marketing, 

Change In Rental Business Value

It measures the overall value of a rental business whether it’s getting increased or decreased over a specific period of business. And changes in the business value involve comparing the business’s current value to its previous value, often expressed as a percentage or dollar amount. 

Some key drivers of change in value may include

  • Asset appreciation
  • Revenue growth
  • Profitability
  • Market conditions

Analyzing the change in rental business value will help business owners, investors, and stakeholders assess the performance and growth of the rental business. 

Rental Growth

The market of the industry would also cause an effect on sales and marketing in your rental business. You should have this KPI to evaluate the total revenue generated by companies within the industry. It will assist you in giving an indication of the industry’s expansion and the demand for rental products. This rental growth calculation would include,

  • Market size expansion
  • Industry value added
  • Number of competitors
  • Rental industry-specific metrics

Customer Acquisition Cost

As discussed earlier in the common business KPIs, the Customer Acquisition cost is similarly applicable to the rental business too. 

In the rental business, CAC will measure the average cost incurred by your business to acquire every new customer. It also includes the number of funds you consumed for marketing, advertising, sales effort, and other activities you have applied to attract gaining consumers. 

CAC = Total Cost of Acquisition / Number of New Customers

Market Revenue Attribution

One of the key KPIs for your marketing is to analyze the market revenue attribution. By doing this you can easily apprehend the impacts of doing different marketing initiatives that help in generating revenue. 

This involves tracking and evaluating the contribution of dynamic marketing strategies you applied for the rental business. It helps you in identifying which marketing efforts or channels are driving the customer acquisition, that leads to the money generation. 

You can do the below marketing attribution to catch the right channels, 

  • Tracking the customer journey
  • Revenue allocation
  • Performance evaluation

The above will assist you to refine the marketing strategies and help in enhancing overall business performance. 

Traffic To Lead Ratio

It is a significant key indicator to note. This measures the efficiency of converting the website/app or store visitors into leads. To say it clearly, it is a calculation ratio that involves dividing the number of website visitors by the number of leads generated in the business duration.

Traffic To Lead Ratio=Number of website visitors/Number of leads generated

By tracking this traffic-to-lead ratio, you can quietly improve the performance of the marketing channels, campaigns, and overall online experience. It assists you in identifying where you can work more for capturing visitor information, optimizing lead capture forms, enhancing store navigation, etc. 

Top Customer Satisfaction KPIs

For any business customer satisfaction is the core center to retaining your business with a high number of consumers. Here are the KPIs to measure your customer satisfaction, 

Customer lifetime value and Customer churn rate are discussed before, and the same will be applicable to your rental business. Let’s explore the remaining parts, 

Social Media Engagement

This KPI measures the consumers’ level of interaction, involvement, and responsiveness in your social media content and platforms. Via this, you can assess the robustness of your digital marketing efforts and the engagement of potential customers. 

It includes, 

  • Click-through-rate
  • Follower growth
  • Brand mentions

By leveraging this, you can improve brand loyalty which helps to increase your business growth. 

Net Promoter Score

It evaluates how likely customers are to recommend your rental business to others. And,  indicates the overall customer experience and the potential for customer retention that helps the growth of a business. 

The net promoters are classified into three segments based on the customer responses, 

  • Promoters (score 9-10)
  • Passives(Score 7-8)
  • Detractors( score 0-6)

To calculate the NPS use the formula, 


Evaluating this you can know the highlights areas for enhancement to increase the customer experience. 

Customer Review

Measure customer satisfaction, feedback, and overall experience with the rental business. It can provide you with valuable insights to enhance your service quality and the customer perception of the rental business. 

Customer review KPIs typically include the meteors to calculate, 

  • Average review score
  • Review volume
  • Nature of the review(positive, negative, or neutral)
  • Review content analysis

By monitoring customer reviews, you can grab the factors like responding to reviews, and addressing concerns demonstrating a commitment to customer satisfaction, and can foster positive relationships with customers.

From the above KPI standards you can explore your rental business and what value you are holding on to. These significant KPIs will effectively work for your business and pull you to drive more strengths for your rental business by improving positive value on all KPIs. 

So, let’s carry on to calculate your rental business with all the efficient KPIs that are needed for the business enhancements.