Average Rental Duration
Calculating Average Rental Duration allows you to see the length of time assets are typically in use by consumers. There exists a direct correlation between rental duration and revenue generation in pricing models in which the cost of Rentals is defined by the number of Rental days. A high Average Rental Duration is more important for firms which do not have a high turnover of Rentals, than those which do, as a lower volume requires that a greater value is extracted from consumers when Rental Sales are made.
Making the KPI
To create Average Rental Duration you will need to know
- Number of Rentals
- Total number of Rental days
Both number of rentals and number of rental days should be uploaded into FUTRLI via CSV. Rental days can be sourced by recording the number of days each Car is in use and then uploading the weekly or monthly totals.
Average Rental Duration is calculated by dividing the Number of Rental Days by the Number of Rentals.
Once you’ve created your formula, you can copy it your Formula Library to use again in the future and report on your results.