Rent a Center
For many customers with bad or nonexistent credit histories big ticket items such as furniture, electronics or cars can seem like a dream. How do people manage to acquire ‘large-scale’ items?
As a rule, experienced buyers get low-interest loans from banks to finance their purchases. However, others can only pay high-interest rental prices every month. There is no reason to ownership under traditional rental agreements. If the renter cannot make the rental payment, the item is repossessed by the owner. This inequality between buyers and renters led to the development of the rent-to-own business model. Rent to own is a service that allows people to buy an item by making a number of regular monthly payments. The item can be returned, until the customer has paid the full amount. So basically the item is rent until a certain series of payments is made. Rent to own services let people buy things without needing the full amount, or even a down payment in some cases, up front. For that reason, the costs are usually quite high. The statistics reports that using rent to own commonly costs twice as much and sometimes even four times as much as purchasing the product outright. If a TV-set, for example costs 200$ at a store, a customer pays 700$ if he/she uses the rent-to-own services. On the one hand it may seem ridiculous to embark on this type of purchase. It is better to live 3 months without television, save some money and then buy at the store at a regular price. And the other 500$ spend on a fridge, for example, in 6 months. On the other hand, you may need an item right away. In this case, it is better to rent a cheap one and the rest of the money save to buy a new one some time later.
However, people seem to miss the idea of this type of industry. Therefore, such companies as Rent A Center are quite profitable.
Rent-A-Center.
Rent A Center is rent to own company. It was founded in 1986. At the present time, the company operates 3,500 locations in the United States, Puerto Rico and Canada. The Rent-A-Center stores offer name-brand furniture, appliances, electronics, and computers. The clients get the merchandise through flexible rental purchase agreements. Rent A Center offers same-day delivery, 90 days same as cash and an early purchase option. If the merchandise need repair while it is on rent, the company repairs it at no additional cost. Rent-A-Center also offers a product substitute for their clients to use while theirs is in service. The company is rapidly growing due to acquisitions and new store openings. Rent-A-Center’s operations include: Get It Now! (merchandise on an installment sales basis); Cash AdvantEdge (short-term loans, check cashing, money transfers, and other convenient financial services); Rent-A-Center Corporate Leasing (provides furnishings for businesses that need short-term living arrangements for employees).