Renting vs. buying furniture is the same argument as op-ex vs. cap-ex.
When does renting make sense?
- When you are sure that you will only use it for less than a year
- When you are sure that you would want different furniture in about a year’s time or less
- When you want additional furniture for a special occasion such as some party, relatives, etc.
- When you are not willing to spend a bulk amount on furniture or in a cash crunch and yet want to have good furniture in your house (you are a customer who is in a cash crunch)
- When you desire for high-quality furniture but you don’t want to spend a large amount on really good design furniture (in this case you are a customer who genuinely wants good design furniture and who doesn’t want to spend a bomb)
- When you don’t care to do the math of rent vs. buy and just look at your life one month at a time
When doesn’t renting make sense?
1. When you are reasonably sure that you will use it for more than 12 months and you are okay with having the same furniture for a few years. In the case of using the furniture for more than a year, the customer would have most likely paid the cost of the furniture and now feels the pain of not owning the asset and that he or she still has to pay the monthly rental to just use it. This is the stage at which the customer starts comparing to ownership and feels bad about renting the product.
2. When you have money to buy it! If you have the money to buy it, then it does make financial sense to buy it and sell it out later. With options such as buy-back guarantee and credit card no interest EMI options, it is very convenient to buy and sell the product back and even buy it in small installments.
GoZefo, which is one of the online furniture companies in India, wrote an interesting post comparing rental vs. ownership. Click here to refer to GoZefo’s rent or buy.