How a True SKU-Based Inventory System Helps Rental Business

The SKU-Based inventory problems posed by even small-to-medium-sized rental businesses is, perhaps remarkably, one of the most challenging problems posed to the SaaS industry even today. 

Let’s spend a few minutes defining the rental company inventory problem in depth, thinking about precisely why it’s important to manage this correctly, why it’s hard to solve, and where we’re at in solving the problem thus far.

The Problem: Not Overwhelming Your Customer While Still Having Perfect Control Over Your Inventory

Rental inventory is deceptively complicated because of the personal nature of simple-looking equipment like a bike or a ski. People spend many hours and thousands of dollars purchasing expensive equipment like this, and rental operators have to go through this rental process efficiently enough that they can make sufficient margins to maintain and grow a business off of much smaller dollar value rentals. 

Skis and bikes have many variables associated with them. Size, color, brand, strengths, weaknesses, ease of use, and performance are all factors that staff need to keep in mind as they select the right equipment for the guest in front of them. They have the expertise to choose correctly. The customer, if presented with the same information, would simply feel overwhelmed and give up.

The information that the staff needs and the customer knows are things like height, weight, shoe size, and skill level. These attributes present a challenge of their own, as the earlier in the process they are collected, the more efficient the booking flow is – but taking this information earlier and with less staff guidance either via phone or in person results in more errors, which reduces efficiency and creates risk.

Only now are we seeing behemoths like MEC and REI attempt to efficiently offer equipment rentals as they recognize the incalculable opportunity present in the rapidly growing share economy. We know that the average time to process a booking like this is as high as 45 minutes on average, providing the opportunity only for razor thin margins on bookings like this. 

Software is actually the key to profitability for this industry. When you look around, software seems to rule our lives and appears to have solved every problem five times over. So why is it so difficult to solve the rental inventory problem gracefully?

Early Solutions in the Booking Software Industry

Around the year 2008, cloud computing technology became available and savvy entrepreneurs created the SaaS model, dramatically reducing the fixed cost portion of running a software solution for a small business by centralizing computing resources through the increasingly powerful internet. 

This made it possible for even small and medium sized businesses in the tours and rentals industry to start using out-of the box software at an affordable price. During this time, many businesses eliminated overbookings, tons of overhead communicating with customers, and streamlined their whole booking flow. Features like real-time reporting and being online bookable became table stakes for the entire industry where just a few years prior this technology would have been considered nothing short of miraculous.

Naturally, the first cloud-native booking solutions solved for the one-layer inventory problem posed by boat, bus, and attraction-based businesses since these businesses were previously the only ones with the scale to afford online booking systems. They designed their software around one simple layer of inventory, and the SaaS booking software industry reached maturity by perfecting this solution and is now in the process of consolidating.

When cold calling sales reps pitched this SaaS software to rental companies, they claimed that their inventory system was robust enough to handle the rental inventory problem. This led to one of two problems.

The rental business had a choice. They could either keep things simple for the customer and manage their inventory in pools, losing the granular control of their individual SKUs.

The alternative was to manage every single sku as a “tour” and explode their inventory into an unwieldy, confusing mess – unpleasant to operate by the rental business and expensive to service for the software company.

As the opportunity for software companies in the one-layer inventory problem continues to shrink, a new generation of booking software companies like Rentrax has spawned to provide a solution to all businesses with the rental inventory problem, no matter their size.

Rentrax’s Solution: Customers Interact with a Subcategory while Staff Interact with Individual SKUs

The solution Rentrax came up with to solve the rental inventory problem is to deal with the inventory in two layers: we present one to the customer in the form of subcategories. Examples would be “Road Bike,” “Mountain Bike,” “Performance Ski,” or “Cross Country Ski.”

It provides customers with the information they need, but not so much information that they get confused. They also provide their attributes like height, weight, and shoe-size up front that the staff can quickly check on arrival. This allows Rentrax to calculate things like the DIN number before the customer even arrives.

The second layer we conceptualize is product inventory. Here we manage individual SKUs, an example would be “Karrhu Dharma, 177cm, Black.” We can also keep track of the status of these individual skis. Who has this exact pair, its maintenance history, how much it cost, how much revenue it has produced, etc.

The subcategory and product inventory meet on the order screen, where the staff has all of the information they need to choose the right ski for the customer and mark the ski as checked out.


Rentrax is growing based on the insufficiency of a single-layer inventory system for rental businesses. When we say we have the ability to handle SKU-based inventory, we actually mean it, we’re not going to give you a choice of which part of your business you have to leave in the dark ages – we are going to digitally transform the whole thing with software specifically designed for you.

If you’d like to see our inventory system in action give us a call at 1 800 248 1370 or send us an email at

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