Should You Buy or Rent Contractor’s Equipment?
You have a job to complete, but only own part of the equipment to get it done. For many contractors, including construction companies and landscapers, it makes sense to rent the rest of your equipment, particularly if it’s not a regularly used piece.
Rental businesses give contractors access to the latest technologies, offer more flexibility and ensure you don’t pay too much for equipment used on a limited basis.
On the other hand, there are certain situations that make sense to purchase new equipment. For instance, if you will use the piece regularly for multiple jobs and have the space to store it.
Let’s review the pros and cons of both options.
Before you commit to buying or renting a particular piece of equipment, think about:
- Your current financial situation, internally and project funding.
- The age of your current fleet.
- Your short-term and future project needs.
With these points in mind, purchasing makes sense when:
- The equipment will be used for a wide variety of jobs and offers enough versatility to perform a range of duties.
- You’ll eventually sell the equipment, potentially recouping the initial cost.
- You have a plan for maintenance, including all supplies for upkeep and the labor required to keep it running.
- You’ve compared the cost of monthly payments to what you would spend to rent the same equipment.
- The equipment is part of a larger fleet. Particularly in storage, logistics and transportation, equipment that’s regularly used is often kept in-house.
- You need your equipment right away. To reduce project downtime and get it done in a reasonable timeframe, anything you can’t wait on should be part of your core fleet.
Big picture – if you only plan to use the equipment for one job, renting offers the better deal.
- Renting often puts more specific, specialized pieces of equipment right at your fingertips, down to the exact size you need for the job.
- Maintenance is not a factor, as the rental company will do all basic repairs.
- Storage is not a factor, so you won’t have to make room or find another facility.
- Transportation is usually not necessary; the rental company will often deliver equipment directly to your jobsite.
- For one-off or intermittent jobs, the rental payments are a predictable expense compared to the costs needed for maintenance and repairs on owned equipment.
- You’ll have access to the latest technologies, as many rental companies carry the most recent models. For this reason, renting allows your team to get acclimated with new equipment, without the expense of upgrades.
- Many rental companies offer a portal for managing orders, so you can see what’s available and when it’ll be delivered in real time. This helps you manage existing and past equipment orders and puts viewable invoices all in one spot.
Whether you buy or rent, it’s important your company has a contractor’s equipment and tools policy. To discuss coverage options, give us a call at 203.729.5261.