Construction companies have to either buy or rent equipment from other companies. The decision to rent or buy equipment will depend on the condition of the company in terms of finances and other factors. If there are rental companies around your area, it is better for your company to go this route. You see, quality equipment rentals are the way to go nowadays because a company can concentrate on its core mandate. A construction company needs to ensure that they are making profits and that it does not take it too long to break even if they were to purchase the machinery outright.
Here are some reasons why renting construction equipment is a good idea:
The company can avoid initial equipment costs
One of the biggest challenges new construction companies face is the cost of new equipment. Construction equipment is very expensive and as such, a new company will find it difficult to buy and get into a profitable business. With this in mind, it would be better and more cost effective for a new company to rent or lease construction equipment. If a company does this, then it can allocate its financial resources to its core functions.
There are fewer repair and maintenance costs
This is yet another advantage that comes with renting construction equipment. With rented equipment, you do not need to think about long-term maintenance and repairs. In some cases, the company renting out or leasing the equipment to you are responsible for their repairs. This means you will not have to incur such costs. Even if you had to take care of these costs, they will be less or significantly lower compared to when you own the equipment.
You are shielded from market fluctuations
Construction equipment depreciates quite fast. This means the company has to bear the fluctuations and losses occasioned by such market forces. When you rent this equipment, it means your company is shielded from the market downturns, and therefore you will have better returns. Apart from your upfront purchase costs of equipment, depreciation of the equipment means you will have a lower resale value. This portends a loss in the long run. Renting construction equipment therefore shields you from such fluctuations.
You have no equipment storage issues
Companies that own construction equipment have to worry about where to keep this equipment when not in use. If equipment is not properly stored when not in use, it will quickly depreciate. The companies that rent the equipment need not worry about this issue. The company will not incur any storage costs as this is the role of the leasing company.
When you rent construction equipment, you do not have to worry about transportation logistics. This is the role of the company that owns such machines. As such, you have no worry or waste of time waiting for the transportation of equipment to the site. Renting means you will avoid this burden and therefore save time and money as your projects will always start on time.