Buying Vs Renting Equipment
Choosing Between an Equipment Rental and a Purchase
There are a lot of decisions to make when your company is looking for equipment, and renting vs. buying is usually one of the biggest decisions. For companies that have the money to buy equipment (financing is available), there are a bunch of considerations. For most companies the benefits of renting equipment outweigh the benefits of buying equipment. Below you will find a breakdown of the pros and cons of both rentals and purchases.
Advantages of Renting Equipment
- Greater Flexibility - With rentals you can easily add a few more machines during the high season, and get rid of some during the low season. You may also find that a different machine will perform better for your needs, and rental companies will typically make it easy to change equipment. If you end up trying to change purchased equipment it's a hassle to sell and buy another machine, and you will end up losing time and money in the process.
- Low Cost - Equipment is extremely expensive to purchase (sometimes more than $100,000), but rentals are exremely affordable. Many companies expand and contract and don't have a good idea about how much equipment they will need, and don't have the capital to purchase equipment.
- Less Hassles - You can often avoid many of the hassles such as equipment maintenance and service, as well as ordering and installing replacement parts.
Advantages of Purchasing Equipment
The main advantage of purchasing equipment is that you aren't on the hook for monthly fees, which can add up if you end up renting for a long period of time (a few years). If you are renting for more than 2 years then you should definitely consider buying equipment instead of renting, but for most cutomers rentals make more sense.