Even though renting heavy equipment and trucks is a popular trend in the construction industry, it is a fact that rentals can only go so far. Sometimes, it makes more sense to buy, especially if machines are meant to be used for a prolonged period of time.
However, buying construction equipment is easier said than done. It is a daunting and costly endeavor and thus important for contractors to be careful to pull the trigger. With equipment costs in the millions, every dollar counts.
You can end up buying a great deal if you consider each one of the five factors listed below.
1. Current Financial Situation
This one probably tops the list. Do you have the capital to purchase heavy-duty construction equipment like Hitachi excavator ex200 2 or would it be better off renting it?
But you should also look at the bigger picture – project costs over several months or years.
Although buying may be a larger one-time financial investment, it is also true that the cost of renting can quickly add up over a long period of time and can end up costing you more. You can also finance your equipment purchase to reduce the initial financial equipment.
2. Estimating The Cost of Ownership vs Cost of Renting
When you estimate and compare the cost of ownership versus the cost of renting equipment, you get a clear picture of how much you stand to gain and how.
Ownership brings with it maintenance, operating costs, insurance, registration, government licensing, state taxes, etc.
Renting is generally an inclusive cost, but you will probably have to pay to transport the equipment to and from the rental store multiple times. Prolonged usage of heavy equipment can cost you much more and make you consider purchasing it from leading heavy equipment and truck auctions online.
Fuel is a common cost here that applies to both owning and renting.
3. Length of Project
Project length or frequency of jobs is another crucial factor to consider as it could be the deciding factor in whether you choose to rent or buy the equipment. Renting makes sense for short term jobs or if you need specialized equipment for a one-off task.
If you’re working on a long project, or have got several jobs on the horizon, then buying is probably the best decision considering the fact that rental costs can add up quickly the longer a job goes on.
4. Heavy Equipment Availability & Usage
The major advantage of owning your own heavy construction equipment is that it’s available with you 24/7. This means you are in total control of it. This saves you a lot of time and energy and eliminates the potential risk of a rental company not having the machine when you need it.
Owning also boosts your chances of getting the contracts from potential clients who know you’ve got the goods that matter to take on their jobs! It also shows your business in a good light.
5. Fleet Management & Inventory Control
Fleet management is something you need to consider. If you have the skills and the time, you can take care of insurance, maintenance, etc yourself to save money over the long haul.
When you own equipment, you can track it down to know who’s operating it and where. It allows you to schedule jobs and equipment accordingly.
Buying gives you added flexibility. If the project length extends for another two months, you will have the machine at your disposal. If the job ends on time or sooner, and you decide you don’t need it, you can sell it again at another upcoming auction and recoup some of your investment.
The listed five factors are crucial to consider before you choose to go ahead and invest your hard-earned capital in renting or buying heavy construction equipment.
Owning equipment is generally a wise idea considering you intend to use it for a prolonged period of time. If you can save money by getting good deals and multiple quotes, it’s an added advantage in your favor.