Is It Better To Rent Or To Buy Construction Equipment

At the present time, a lot of industries need special equipment. These include utilities and road services, construction companies. Most of them buy their own special equipment. But only a few people rent it. Let’s carefully consider, point by point, which will be more profitable, buying special equipment or renting it.

The cost

The cost of special equipment is very high. It is a big investment even for large companies to buy even the smallest special equipment. But the cost of renting such equipment, even for a month or two, will not cause significant financial damage to anyone.

Staff recruitment

Immediately after the purchase of special equipment, it becomes necessary to search for qualified workers. Today, finding a good employee is not as easy as it seems at first glance. Very often, it takes several months to find a highly qualified driver. And there are times when an employee leaves and there is no one to replace him until a new one is found. If you rent equipment, you can avoid this problem, since the lessor provides equipment with drivers.

Salary

When buying special equipment, when you still manage to find a qualified specialist, there will be a need to pay for his labour. There are many companies where a backhoe loader works for a month, then it costs two months. And so regularly. In such cases, the driver’s wages must be paid even during downtime. This is a big disadvantage. Some think that it is possible to find such drivers who agree to work seasonally. No, it’s not. An adequate person will not agree to work for a month and sit at home for two. That is why it is much more profitable to rent special equipment together with a driver. Apart from the rent, nothing else needs to be paid. And this is another advantage!

Maintenance and repair

From time to time, any technique, even the newest one, needs maintenance and repair. There are always breakdowns that require appropriate specialists to eliminate them. When buying special equipment, it will be necessary to hire such specialists or contact special workshops. Both options will create significant financial difficulties. In addition, in any special equipment, there are many consumables that need to be replaced after a certain time. These are engine oil, gearbox oil, hydraulic oil, brake fluid, and more. The lessor is responsible for all the breakdowns of the leased equipment. It also provides replacement of all consumables.

Storage of equipment

If you buy special equipment, then immediately you need to allocate storage space for it. An indoor box would be ideal. But more often, such special equipment is stored in a protected area. And this is a kind of additional financial burden. The more equipment there is on the territory, the higher the responsibility of security, and, accordingly, the higher is their salary. In addition, additional equipment occupies a significant area that could be leased and made a profit for it. The storage of rental special equipment is carried out by the lessor.

Other expenses

When buying special equipment, there will be additional costs for its maintenance. For example, an additional financial burden when maintaining special equipment will be a CTP policy. In addition, the transport tax will have to be paid regularly. Such small expenses will appear regularly.

Accounting

Each new unit, without fail, must be put on the balance sheet of the enterprise that owns it. For each piece of equipment, you must keep appropriate documentation. Also, additional documentation must be kept for the driver who will operate the special equipment. This is an additional financial burden on the accounting department. When buying a large number of special equipment, it is often necessary to increase the staff of the accounting department.

The assortment of special equipment

If it is possible to purchase one unit of special equipment, then this special equipment will have to work in all cases, even when it would be more efficient to use other special equipment. But if you rent equipment, you can rent a small excavator today, and tomorrow – hire a forklift, the day after tomorrow – a mini loader. Renting special equipment makes it possible to use the most effective equipment at a particular time.

The moral side

When buying new special equipment, difficulties arise that are not associated with financial costs. It is necessary to think and look for where to repair it. It is necessary to search for personnel. In short, you need to constantly “think”. The lessor will “think” about the rental special equipment. So it’s better to think again before purchasing this technique. After all, renting it is much easier.

Conclusion

We have carefully analysed many points. The rent of special equipment is the leader in all points. We do not claim that there are no such situations when the purchase of equipment would be a more profitable solution. But this happens only in isolated cases. As practice shows, in 90% of cases, it is more profitable to rent the necessary special equipment than to buy it. Rental special equipment not only saves financial costs but also saves a lot of nerves.