When to Buy or Rent Heavy Equipment?
It’s about considering both the upfront and long-term costs. When you buy new equipment there’s a huge upfront expense (plus insurance, taxes). On the other hand renting equipment could help better spread the costs.
However, it’s also about the project you’ll be handling. For example, if you’ll regularly use a backhoe it’s practical to buy new machinery instead of renting. This also applies if you expect there will be a lot of future jobs that require a backhoe in the future. But for one-time jobs or infrequent requests, renting could be a wiser choice.
Combination of renting and buying
Some firms choose to do both renting and buying for maximum flexibility and possible ROI. For instance, they might rent 1 or 2 backhoes and supplement that by buying a new one. Some also choose to rent at first and then buy new machinery as the business grows.
There’s no solid advice when deciding whether to buy or rent. We all have different financial situations that can greatly affect how we decide especially when cost is a huge factor. But in general, it always helps to maintain some flexibility and tight control of cash so you can still thrive and pivot in the future.
Consider used equipment
Many firms also have some used equipment in their fleet. That’s because good deals are always present. Many engineers have found used equipment in very good conditions and at great prices.
Purchasing used equipment greatly reduces the huge initial expenditure as opposed to buying brand new machinery. You can even get discounts depending on the negotiations which will save you more money.
To know if this option is right for you, compare the costs of new versus used equipment. Also make a third column so you can also analyse renting equipment instead. You then focus on the upfront and long-term costs of each option.
It’s recommended to do that analysis while keeping in mind your present financial situation and job prospects. Remember that if the future is bright, it’s ideal to own the equipment for better control and long-term savings.
When to buy or rent heavy equipment
Whichever is the case you can call us today here at 07 4943 6160. Here at K & G Machinery, we can help you get the right equipment for your project or firm (whether renting or buying). Since 2004 we have been focusing on the economic utilisation of heavy equipment.