While assessing your current and future projects, you realize you need a new piece of machinery. You evaluate the job needs and decide on a piece of equipment. Now you need to decide: rent, buy, or lease? There are several factors to consider for this decision, and Perry Brothers Heavy Equipment has advice on which choice is best for you.
Renting
You might choose to rent when you need the machine for a single short-term job. Renting is convenient for a specific task or a short-term project lasting just a few weeks.
A rental purchase option (RPO) might be practical if you need a machine for an extended period and are considering buying the machine when the contract ends. An RPO takes place over a predetermined period (often 6+ months). During this period, a part of the payments made go towards the purchase price. When the rental contract is over, you may choose to buy the machine.
Find a company whose policies can meet your needs and bring you peace of mind. For instance, some companies manage routine maintenance for their equipment. They might also offer guarantees to replace machines that are experiencing major breakdowns or mechanical issues. These types of policies can ease worries about missed deadlines caused by faulty equipment.
Leasing
You could choose to lease equipment when you have a long-term project or multiple shorter ones. Leases are for longer periods of time than renting; they often last between 18 and 36 months, although they can be longer. Leasing comes with the ability to keep your budgeting costs for equipment consistent and can preserve capital for your other business needs and investments. Lease contracts often include buyout options, like with RPOs. If you keep in mind scheduling, work needs, and budget, leasing could be an excellent choice.
Keep in mind that a lease can impose limits on equipment wear, tear, and usage time. Your contract might say you can use the machine for up to 500 operating hours, but you use the machine for 750 hours. You will need to pay for the extra hours used. There are wear-and-tear stipulations as well. Your contract could require that you replace tires if they reach less than 50% usable life and tread left before the lease ends.
Buying
Buying is likely the best option to replace machines you already own or for new pieces of equipment that you plan to use consistently for a long time. All payments made count towards the purchase price, leading to ownership and the option to sell later.
You should consider the Total Cost of Ownership (TCO) while looking into buying a piece of machinery. TCO accounts for the current market rate, machine value, repairs and maintenance, and resale value with depreciation after a few years. These are all factors in how much money you really commit to spending when you buy a machine.
Perry Brothers Heavy Equipment is here for you whenever you decide. We offer more than just renting and buying machinery. We can help with parts ordering, routine maintenance, repairs, and more.
