The formula, with no black box
Daily rate = [(purchase ÷ payback years + annual fixed costs) ÷ annual rented days + daily variable cost] ÷ (1 − margin).
How to use the figure honestly
The result is an economic floor based on your assumptions. A commercial rate must also be checked against the market and your realistic ability to win bookings.
Use it as a starting point for tools, event equipment, AV, photography and other movable assets.
Use realistic utilization
If the asset could go out for 25 days but normally rents for 8, spread costs over 8. Availability is not demand.
Do not confuse margin and markup
A 20% margin means costs equal 80% of the selling price. Simply adding 20% produces a lower margin.
Stress-test the assumptions
Run the numbers again with fewer rented days and higher costs. If the purchase only works in the best case, it is fragile.
What this calculator does not decide
It does not estimate demand, financing, tax, non-payment, exceptional damage or residual value. It is not a detailed quote and does not guarantee profitability.
Read the guide to calculating ROI and paybackWhen you need the full analysis
Move from a quick rate to a defensible decision.
HireYield Offline compares scenarios, break-even bookings, utilization, ROI, payback, multiple assets and printable quotes. Pay once and use it offline.
Equipment rental rate questions
Should I use available days or rented days?
Use the days you realistically expect to invoice. Dividing costs by every available day usually understates the cost of each day that actually earns revenue.
Does the rate include tax?
No. The result is shown before tax so you can apply the rate appropriate to your operation and country.
Can I use it for weekly or monthly rates?
Use it as a daily reference. Duration discounts should be checked separately to ensure they still cover cost, labor and margin.
Does this guarantee profitability?
No. It is a mathematical estimate based on your inputs. Actual demand, damage, non-payment and other factors can change the outcome.