When it comes to making a decision to buy or rent heavy machinery, we will never be able to find a clear right or wrong answer to it. That’s because the real answer lies in identifying the specific need for every construction project. You can indeed make the best decision referring to a list of factors for you to work with. Here, we list you the 5 most crucial factors to look at before deciding to buy or rent heavy equipment.
1. Current & Future Financial Situation
The most obvious factor to consider is the financial situation. Evaluate your company’s current financial situation. See if the capital that you have, best suits to buy or rent heavy equipment. This too means that you should look beyond your current situation and project costs months or years ahead.
From there, you will be able to calculate the estimated cost that possibly takes if you were to rent or purchase the heavy equipment. Hence, depending on the duration can you identify which would be a better financial deal for your choice.
In many cases, companies that tender projects which take years to complete, typically prefer purchasing heavy equipment. However, you should also take account of the financial ability of your company. To give a better view of the scenario, consider buying heavy equipment and you will experience a larger one-time financial burden.
However, renting them, on the other hand, can potentially add up to your financial burden. Eventually, ends up costing you more, especially if the equipment is not used throughout the renting period. On the other end, you would experience the advantages of using the newest equipment with the latest technology. Hence, you need to consider the financial risk:reward ratio in every renting or purchasing process.
a. Buy well-maintained used heavy equipment
Typically, used equipment is maintained well with consistent maintenance. Hence, purchasing it at a cheaper price could be one of the best options
b. Finance your purchases
Financing your equipment purchases can give your company some financial breathing room.
So, pick your expenses.
2. Cost of ownership vs renting of heavy equipment
You must always bear in mind the cost of ownership or renting heavy equipment as the weightage differs.
a. Cost of ownership
The cost of ownership includes maintenance and operating costs, insurance, and other fees such as government licensing which vary according to the types of heavy equipment that you own.
b. Cost of rental
The heavy equipment rental cost is inclusive of the purchase price, cost of ownership and potentially supporting the transportation of the equipment. On top of that, you might need to consider fuel consumption too, depending on the company you are partnering with.
Also, note that these requirements may differ according to companies. Hence, generally, it is advised to look through these several aspects before making buying or renting decisions. Always stay reminded of the consequences of an unplanned business, especially in the construction industry that involves a big amount of money flow.
3. Length of project or job frequency
Considering construction project length and heavy equipment usage is crucial when it comes to deciding whether to buy or rent heavy equipment. If the project occurs in the short term, a one-off job or needing a specialized piece of equipment, then opting to rent heavy equipment is a better option, provided the equipment is used throughout the rental period.
However, if the projects you tender are of long period, owning the equipment is a smarter choice for you can save up a bigger amount of money for your emergency needs. A better option could be purchasing or renting multi-purpose heavy equipment that can be used for a variety of projects.
4. Heavy equipment availability and usage
When it gets to renting or owning heavy equipment, companies generally consider the availability and usage of them. If it happens that the machinery is constantly unavailable but they obtain frequent project tenders, then they should purchase the equipment. It is a bigger advantage to own heavy equipment because companies can take on projects at a moment’s notice with less downtime.
Hence, it is essential for you to weigh the potential risk of the availability of the machine you need during urgent times. From a different perspective, it is a greater advantage to own heavy equipment as it creates a good reputation for clients. From the collection fo equipment you own will they consider your company a stable one and is trustworthy for businesses.
Just so you know, B & F Group outshines other typical construction companies in Malaysia despite renting out the heavy equipment. We have several heavy machines of the same type available for rental while providing fast and efficient after-sales service and support.
Not to forget, our readily available spare parts to repair machines the soonest possible. Hence, the availability of equipment is no longer a worry when you have us.
5. Fleet Management and inventory control
If owning heavy equipment is one aspect to think of, managing is a whole different story that we are talking about. If you have skills and can afford to invest time to manage the machines, their insurance, and maintenance, then owning them will save you so much money.
However, if you are not as skillful or you lack management experience, then you might want to spend a little extra by renting the heavy equipment. You need not worry about finding a space to store the equipment and maintain them at all times.
With the above top 5 most important things to consider, you will be able to evaluate the pros and cons that will bring to your financial status, hence, leading you to make the best decision for your business. There are more aspects that you can look out for to get a clearer idea of your decision-making process.
On a side note, if you would like to know what B & F Group has in store for you with their heavy equipment and renting packages, do drop by at our physical factory. B & F Group provides you with consultations that best suit your business needs.