How to Start a Video Rental Business: A Comprehensive Guide

If you’re someone who loves movies and thinks that the rise of streaming services has put a damper on the good old-fashioned habit of renting DVDs, starting your own video rental business could be the perfect adventure for you. Whether you’re looking to start a brick-and-mortar store or an online rental service, there’s always going to be a demand for people who want to watch movies on their own time, free from the whims of ever-changing licensing agreements.

Of course, starting any business can be daunting, especially if you’re not sure where to begin. But with a little bit of research, determination, and a love for movies, you can easily turn this dream into a reality. From scouting out the best locations and finding distributors to creating a business plan and building a strong online presence, there are many steps you can take to ensure your video rental business is successful and sustainable.

Don’t worry if you’re not an expert in the business world – with the right mindset and a passion for your product, anything is possible. A video rental business could be the perfect way to do something that you love for a living, while also connecting with customers who share the same enthusiasm. So why not turn your love for movies into a fully-fledged business venture? With the right approach, it could be the beginning of a new and exciting career.

Conducting Market Research for the Video Rental Business

Before starting a video rental business, it is essential to conduct market research to ensure that there is demand for this type of service in the area. Without proper market research, launching a video rental business can lead to high overhead costs and low profitability.

The following are steps to conduct market research:

  • Identify the target market: The first step is to identify the target market. Is the video rental business catering to families with children, young adults, seniors, or a mix of these groups? Knowing the target market helps in selecting the appropriate titles and pricing for rentals.
  • Analyze the competition: Analyze the competition in the area. How many video rental businesses are there in the vicinity? What are the strengths and weaknesses of these businesses? How can your video rental business stand out from the competition?
  • Survey potential customers: Conducting surveys can provide valuable insights into consumer preferences, needs, and expectations. Some questions to include in the survey include; what type of movies do they prefer? How often do they rent movies? Do they have any suggestions for improving the video rental business?

Market research can also involve gathering information on industry trends and future growth prospects. This knowledge can help in making informed decisions on inventory, equipment, and pricing strategies.

Identifying the target audience for the video rental business

One of the most important factors to consider when starting a video rental business is your target audience. Knowing the specific group of people who are interested in renting videos will help you tailor your offerings and marketing strategies to maximize your profits.

  • Movie Lovers: This group includes individuals who love watching movies regularly and are willing to pay for quality content. They prefer access to newer films and genres and are likely to rent multiple movies at once.
  • Families: Families often rent movies as a family bonding activity. They prefer family-friendly content and may rent movies for kids.
  • Gamers: Video game enthusiasts are also potential customers of a video rental business as they may rent video games instead of purchasing them outright.

After identifying your target audience, the next step is to determine their preferences and needs. Conduct market research to learn more about your target audience’s movie and video game preferences, the types of titles they are likely to rent, and the price range they are willing to pay. This information will help you stock your inventory and pricing strategies to appeal that audience.

Additionally, it is essential to keep up with the latest trends and industry changes. Regularly review your inventory to ensure that it is up-to-date and meets your audience’s demands. Conduct surveys to get customer feedback about the titles you stock and the prices you set. Listening to your customers can help you make strategic decisions that could potentially increase your business’s revenue.


Identifying your target audience is crucial when starting a video rental business. Once you have identified your audience, you can tailor your offerings and marketing efforts to appeal to them. It’s essential to keep track of the latest industry trends and conduct market research to stay up-to-date with your audience’s needs and preferences. By taking these actions, you can increase the likelihood of success for your video rental business.

Choosing a Suitable Location for the Video Rental Store

If you’re considering starting a video rental business, choosing the right location is paramount to its success. Here are a few factors to consider when selecting the perfect spot:

  • Density of population: High-traffic locations with dense population is ideal for your video rental store. This can help ensure regular foot traffic and repeat customers.
  • Accessibility: Your location should be easy to get to, with plenty of parking for customers.
  • Proximity to competitors: Stay away from areas where there are already multiple video rental stores. It will only increase competition and decrease your customer base.

Once you’ve narrowed down your search to a few potential locations, there are additional factors to consider:

  • Cost: Is the rent for the location affordable? Factor in all the costs, including utilities, insurance, and taxes, before making a decision.
  • Physical space: Assess the layout and square footage of the location and determine whether it can accommodate the equipment and shelving required to run your business.
  • Lease terms: Look at all lease terms, including length and renewal options, to ensure you’re making a sound investment.

Ultimately, the right location can make or break your video rental business. By taking the time to weigh key factors, you can choose a location that will set you up for success.

If you have multiple potential locations in mind, consider creating a comparative table with all the relevant factors, such as rent and accessibility, to help you make an informed decision:

Location Rent Accessibility Proximity to competitors
Downtown $3,000/month Easy access to public transportation Multiple video stores within a five-block radius
Suburbs $1,500/month Plenty of parking available No video stores within a ten-mile radius
Strip mall $2,500/month Easy access from the freeway One video store directly across the street

By weighing all the options, you can make an informed decision and select a location that will set your video rental business up for success.

Obtaining necessary licenses and permits for the video rental business

Starting a video rental business requires a few licenses and permits to operate legally. It’s important to get these documents prior to opening your store to avoid legal troubles.

  • Business License – This license is required for any type of business and can be obtained from your city’s or county’s business licensing office.
  • Retail License – A retail license is mandatory if you plan to sell or rent physical copies of movies and games in your store. It is generally issued by the state.
  • Zoning Permit – This permit covers the regulation of businesses in specific areas. It is issued by your city’s zoning department and needs to be acquired before renting a physical storefront.

Once you have successfully obtained these licenses and permits, you can display them in your store for customers to see. This lets them know that you operate legally and can be trusted.

It’s important to note that the requirements for business licensing and permits vary by state and municipality, so it’s best to check with local authorities before starting your rental business.

In addition to these documents, it’s essential to have a solid understanding of copyright laws. Be sure to familiarize yourself with laws, regulations, and policies regarding intellectual property to avoid infringing on the rights of others.

License/Permit Issuing Authority Costs Involved
Business License City/County Business Licensing Office Varies depending on location
Retail License State government Varies depending on location
Zoning Permit City Zoning Department Varies depending on location

It’s crucial to ensure that all of the necessary licenses and permits are obtained before opening your video rental business to avoid any legal issues in the future.

Selecting a Wide Variety of Movies for the Video Rental Business

When starting a video rental business, one of the most important aspects is selecting a wide variety of movies to offer to your customers. Here are five key factors to consider when deciding what to stock:

  • Genre Diversity: Make sure to have a mix of genres, from popular movies to niche films. Some popular genres include action, horror, drama, comedy, and romance. You could also consider adding foreign films, documentaries, and independent films to the mix.
  • New Releases: It’s always important to stay up to date with new releases, as many people will want to rent the newest movies. Consider joining a distributor such as Redbox or Netflix to ensure you always have the latest titles.
  • Classics: There’s always a market for classic movies, which can include anything from old Hollywood films to cult favorites. Consider stocking some of the most popular classic movies to appeal to a wider audience.
  • Kid-Friendly: Families with children are a key demographic for video rental businesses. Make sure to have a selection of G, PG, and PG-13 rated movies for kids of all ages.
  • TV Shows: Many people prefer to binge-watch TV shows, so consider stocking popular series such as Friends, Game of Thrones, and Breaking Bad.

Additionally, it’s important to keep track of what your customers are renting the most and adjust your inventory accordingly. Consider using a rental software program to track your inventory and rentals to make data-driven decisions about what to stock.

Here’s an example of what a diverse movie selection could look like:

Genres New Releases Classics Kid-Friendly TV Shows
Action Spider-Man: No Way Home The Terminator The Incredibles The Mandalorian
Horror Halloween Kills Night of the Living Dead Monster House Stranger Things
Drama The Power of the Dog Citizen Kane Matilda This Is Us

By considering genre diversity, new releases, classics, kid-friendly movies, and TV shows, you can provide a comprehensive selection of movies that will appeal to a wide range of customers.

Deciding on pricing strategies for renting videos

One of the most critical aspects of starting a video rental business is deciding on pricing strategies. Here are some pricing strategies you can use:

  • Flat fee: Charge a fixed amount per rental, regardless of the video’s popularity or age. This pricing strategy is suitable for smaller video rental businesses with a limited collection.
  • Tiered pricing: Offer different pricing tiers based on the movie’s popularity or age. New releases can command a higher price while older movies can be rented out for a more affordable price.
  • Membership Plans: Offer monthly or annual membership plans where customers pay a flat fee and rent multiple movies. This is a good strategy for customers who prefer to rent movies regularly and can result in a reliable revenue stream for the business.

Before deciding on your pricing strategy, it is essential to do some market research to determine the market rates and pricing strategies of your competitors. This will help ensure that your pricing model is competitive and attractive to potential customers.

Another factor to consider when deciding on pricing strategies is the cost of the movies themselves. Buying movies can be expensive, and your pricing strategy must take into account your expenses and ensure that you can make a profit.

Here is an example of a pricing strategy for a video rental business:

Movie Type Rental Price
New Releases $5.99
Popular Movies $3.99
Older Movies $2.99
Membership Plans $15.99/month (up to 3 movies)

Remember, it is essential to be flexible with pricing strategies. As your video rental business grows, you may need to adjust your pricing strategy to meet customer demand and keep up with your competitors.

Purchasing equipment and supplies needed for the video rental store

Starting a video rental business requires a significant investment in equipment and supplies. Below are some of the equipment and supplies you need to get started:

  • Shelving units: The shelving should be sturdy and be able to support the weight of the videos and DVDs.
  • Lighting: The store should be well-lit to enable customers to browse through the selection easily.
  • Signage: The signage should be eye-catching and should highlight the type of products available in the store.
  • Computer and POS System: A computer with a POS system is essential to keep track of rental history and manage inventory.
  • Televisions and DVD players: These are necessary for testing and previewing movies for customers.
  • Security cameras and alarms: To ensure the safety and protection of the store, security cameras and alarms are a must-have.
  • Office supplies: These include items such as pens, paper, scissors, and tape, which are essential for the smooth running of the store.

Additionally, it is crucial to have plenty of DVD and video titles in stock. However, getting the best deals requires research and purchasing strategies.

Below is a table that shows the average cost of buying new DVDs and videos from a distributor:

Product Cost per unit
DVD $10-$20
Blu-ray $15-$30
Video $2-$5

It is essential to research and identify distributors that offer the best prices for DVDs and videos. By negotiating with these distributors, you can get better prices and larger volumes of movies for your store.

By investing in quality equipment and supplies, it is possible to create an attractive and professional video rental store that customers will love.

Creating a Marketing Plan to Promote the Video Rental Business

One of the most critical factors for any business’s success is marketing. Without effective marketing, it will be hard to attract customers to your video rental business. Therefore, you must create a comprehensive marketing plan to promote your business and connect with your target audience. Here are some tips on how to create a useful marketing plan:

  • Define your target audience: Developing a clear understanding of your target audience is essential for creating marketing messages that resonate with them. Study your target audience’s demographics, interests, and behavior to ensure that your marketing efforts are directed towards them.
  • Create a unique brand identity: Your brand identity is a reflection of your business values and mission. Create a unique brand identity that sets you apart from the competition and resonates with your target audience.
  • Choose the right marketing channels: Identify the marketing channels that your target audience frequents and create marketing messages that fit these channels. Utilize social media, email marketing, digital advertising, content marketing, and other channels as appropriate to reach your target audience.

Once you have developed a marketing plan, it’s essential to track and evaluate your marketing efforts regularly. Use analytics to determine which marketing efforts are working, and which ones require tweaks or changes.

A successful marketing plan can help you attract more customers and grow your business, so invest time and effort into developing a plan that works for your video rental business.

Developing a Customer Loyalty Program for the Video Rental Store

If you want to keep your customers coming back to your video rental store, you need to have a strong loyalty program in place. By offering incentives to your most loyal customers, you can keep them coming back and also attract new customers. Here are some tips for developing an effective customer loyalty program:

  • Offer points for every rental or purchase – Customers can accumulate points every time they rent or purchase a video, which they can later redeem for rewards.
  • Provide incentives for referrals – Give your customers discounts or free rentals when they refer a friend to your store.
  • Create a VIP tier – Offer exclusive benefits for your most loyal customers, such as early access to new releases and discounts on premium titles.

Before implementing a customer loyalty program, it’s important to do some research and determine what incentives will resonate with your target audience. You should also make sure that the program is easy to understand and easy to use. Once you have your program in place, promote it through your website, social media, and in-store signage.

Below is an example table of a possible customer loyalty program:

Membership Level Points Needed Benefits
Bronze 0-499 10% off every 5th rental
Silver 500-999 Free rental every 10th rental
Gold 1000+ 20% off all rentals, exclusive early access to new releases, and free popcorn with every rental

Remember, the goal of a customer loyalty program is to create a relationship with your customers that goes beyond the transactional. By offering rewards and incentives, you can build customer loyalty and create a devoted following for your video rental business.

Implementing Inventory Management Strategies to Ensure Availability of Popular Titles

If you are starting a video rental business, one of the main goals is to provide your customers with access to a wide variety of popular movie titles. In order to do so, it is crucial to implement an effective inventory management system.

A good inventory management system should help you keep track of the movies you have in stock, their condition, and which ones are most in demand. Here are some strategies that can help:

  • Use a robust inventory management software. This is the most important step in keeping track of your inventory. A good inventory management software will allow you to keep track of your stock levels, update your inventory in real-time, and generate reports on your sales and inventory levels.
  • Set up a reorder point. A reorder point is the minimum number of movies you need to have in stock at any given time. When your inventory falls below this point, you should reorder more copies of the movie to ensure that you always have enough in stock for your customers.
  • Track demand for popular titles. Use your inventory management software to keep track of which movies are the most popular among your customers. This will allow you to anticipate demand and ensure that you have enough copies in stock to meet that demand.
  • Monitor the condition of your movies. Keeping your movies in good condition is crucial to your business. Regularly inspect your movies for wear and tear, and replace any damaged copies immediately.
  • Categorize your inventory. A well-organized inventory will make it easier for you to find movies quickly and keep track of your stock levels. Categorize your movies by genre, release date, and popularity to make it easier to find popular titles.

Inventory Management Software

As mentioned earlier, implementing a good inventory management software is crucial to keeping track of your inventory. There are many software options available in the market, and it is essential to choose one that is specifically designed for video rental businesses. Here are some features to look for in a good inventory management software:

Feature Description
Real-time inventory tracking Allows you to update your inventory in real-time, so you always know what movies are in stock and what movies need to be reordered.
Order management Allows you to manage your orders efficiently, so you never run out of popular titles.
Reporting Gives you access to detailed reports on your sales, inventory levels, and customer behavior, so you can make informed business decisions.
Barcode scanning Makes it easy to scan movies in and out of your inventory quickly and accurately.

By implementing these inventory management strategies and investing in a good inventory management software, you can ensure that your video rental business always has popular titles in stock and satisfy your customers’ needs.

FAQs about How to Start a Video Rental Business

1. What do I need to start a video rental business?

To start a video rental business, you will need a location, inventory, shelves, display cases, and a cash register. You will also need staff to manage the store.

2. Where can I rent videos from?

You can rent videos from wholesalers, distributors, or movie studios. You can also purchase videos on platforms like Amazon and eBay.

3. How do I set prices for rentals?

Prices for rentals should be based on the cost of the property and the amount of time it will be rented. For example, if you purchase a property for $20 and rent it for 24 hours, you can price it at $3 per day.

4. How do I advertise my video rental business?

You can advertise your video rental business through local newspapers, flyers, billboards, and online platforms like social media, YouTube, and Google Ads.

5. How do I keep track of my inventory?

You can keep track of your inventory by creating a spreadsheet or using inventory management software. Make sure to keep track of the number of videos you have and their condition.

6. How do I keep my videos in good condition?

To keep your videos in good condition, you should handle them carefully, store them in their cases, and ensure they are not exposed to sunlight or extreme temperatures.

7. How can I attract more customers to my video rental business?

To attract more customers, you can offer discounts, create loyalty programs, host movie nights, and provide excellent customer service.

Thanks for Considering Starting a Video Rental Business with Us

Starting a video rental business can be an exciting venture, and we hope our FAQs have provided useful insights for your journey. Remember to stay focused, work hard, and always seek opportunities to improve your business. Thank you for reading, and we look forward to seeing you again!