Financial Models

The equipment rental business is a cash flow business. Depending on how you are financing your startup costs and/or taking on investors/debt, the return on capital can be great. This model tries to show the cash flow on a monthly and annual basis against any long-term debt. This model has two versions, both included in the purchase. The ‘modified’ version has more granular assumptions, but a shorter outlook (5 years) compared to the base 10-year version.

The assumptions are really straightforward. The user starts by defining equipment purchases over time and the configuration is based on productID, start month, average monthly utilization, and average daily rate per each productID. This can be used for up to 100 slots (to account for multiple purchases / salvage values over time). Additionally, there is expense logic tied to how often you believe each piece of equipment will be rented out for (and the resulting delivery costs there and back defined by two cost inputs). This logic is in both versions. The final output summary displays a pro forma that drives down to EBITDA and cash flow per month and year. There is also a DCF Analysis, IRR, and cash flow visualizations.