In the construction industry, whether to hire or purchase the equipment can often prove to be a difficult choice to make. Ownership may have a lot of advantages, but it can be a substantial long-term investment that the business will need to cope with, while rental could indeed be beneficial in terms of savings but may be lacking in terms of equipment availability. Because of the incredibly high costs usually attached to this highly specialised earth-moving machinery, only after careful consideration can the correct decision on the matter be reached.
- Consider the capacity and needs of the business
It’s good practice in any business to make sure that you’re getting the most out of your investment, and this very same general rule of thumb applies to the construction industry. The importance of this cannot be stressed enough, as the success of a company can often hinge on its ability to utilise its resources in an efficient manner. If the business is expected to have a steady flow of work that will demand regular use of construction equipment, it may be a better option to purchase the machines. However, if the projects come in less reliably then it becomes more economical to rent.
The business must also be able to support the costs of the purchase. Up-front expenditure isn’t the only factor that needs consideration. While the tools of the trade in this industry differ in form and purpose, they will always share a common need for maintenance and repair. This is an additional cost that ownership will undoubtedly require. Similarly, rental can also be a lot less sensible when there is a more consistent influx of projects, and availability can prove to be an issue too.
- Market value and depreciation
Construction may be one of the oldest and steadiest industries in the world, but it cannot escape the unpredictability of the economy and how it will affect the resale value or depreciation of the equipment. The biggest obstacle that many face in making a decision to buy is how well it will stand the test of time not just in performance but in value too. One way to get around this is by comparing popular brands and their respective prices. This is especially important for those who prefer cycling and procuring new and better equipment regularly.
- Management of fleet and costs of transportation
Storage and logistics are crucial parts of ownership, and a significant investment in itself. If this proves to be too heavy of a financial burden on the company, the job can be outsourced as an alternative. This is perhaps the biggest advantage that rental has over ownership as it avoids this issue completely. Plant hire in Chesterfield and similar businesses have a wide array of equipment that will be needed, and cost is associated only with duration of use.
Choosing whether to buy or rent construction equipment may be a tough call to make, but loss and expenditure can be mitigated by analysing the needs of the business and influx of work. Risks will always be a part of any industry, and with these careful considerations you’ll minimise the chances for failure.