Having used merchandise on the floor is like gravity...It is an undeniable, inescapable fact of the Rent to Own universe. While you can't eliminate returns, you can decrease the idle time of returned merchandise by increasing its value to potential customers.

Fact: Rent to Own is viewed by most customers as a short term transaction.
There are two types of rent to own consumers. Those that view the transaction as a week to week, temporary transaction, and those that enter the transaction with the goal of acquiring ownership. The vast majority view it as a week to week transaction ...(sorry Senator, but it's true). As a result, the "term" of an agreement is of less importance than the renewal payment. In other words, for a reduction in term to induce a customer to rent a used washer over a new washer at the same payment, the reduction in term will have to be so large as to offer obvious advantages to the customer. Unless you have no new merchandise on your floor, those advantages will have to outweigh the desire to rent something new.

Soon, Certain, and Positive
The most effective consequences are those that are Soon, Certain, and Positive. To a customer that wants a washer now, the most important thing is payment. The benefits of a lower weekly payment are Soon, Certain, and Positive vs. the long term advantages of a shorter rental term resulting in a lower overall cost to acquire the goods.

Why...you ask? Because, regardless of what the consumer groups say... getting it today with the least amount of hassle is the overriding factor when consumers choose rent to own. Civilians reading this article should not assume anything about the rent to own consumer because of this fact. Americans from all walks of life make the same choices every day. Leasing a vehicle vs. buying on credit, or for cash, is a perfect example. Leasing simply costs more. But it offers the immediate advantages of 'no hassle' and 'lower payments'.

Example
Picture 3 identical Living Room groups. One is new, two are used.

Consequences to the Consumer Shorter Term vs Lower Payment
	Soon	Certain	Positive
Shorter Term	Takes time to realize advantage	Only an advantage if kept for full term	Total cost is lower
Lower Payment	Immediate advantage	Advantage is realized every time a payment is made	Lower weekly cash outlay

There are many ways to improve the odds of a customer renting a used item vs a new one.

Reduce Term
Leave the payment the same and reduce the term. While this is the best alternative for you, it offers the least inducement for customers.

Reduce payment
Leave the term the same and reduce the payment. This offers customers the most immediate advantage.

Reduce payment and term
Reduce both the term of the agreement and the payment. This offers the highest level of perceived value to all customer types, those that want to acquire ownership, and those viewing the transaction as temporary..

Another way
If lowering payment and term on used merchandise, doesn't appeal to you, attack the problem from a different angle. Leave the payment the same, lower the term 1 month for every 2 or 3 months an item has been rented, and offer the first month at half price. This gives the immediate advantage of less cash needed up front while maintaining your overall projected income.

Whatever your strategy, make a plan and stick to it. Be consistent. Put your plan into action, track the results over time, and adjust to meet your goals.

A customers desire to rent new merchandise is inversely proportional to his desire for a lower payment.