In the construction field, there are any number of tasks that require the use of heavy equipment. Aggregates need to be produced and refined out of rock or gravel, for example. Aggregators and crushers produce landscaping or other materials for paving, trenching, and landscaping. Screeners help you separate the aggregate according to the differing needs onsite. Shredders provide fresh mulch and can help reduce the costs of waste disposal, including both the costs of transportation and costs to be paid to the disposal provider.
Construction firms need to evaluate the financial costs and benefits when comparing renting and purchasing heavy machinery. Renting has advantages over an outright purchase by saving cash and time. Let’s face it, in the world of construction, time is money as well. Delays in projects can lead to loss of revenue on current jobs as well as limit the number of future projects.
1- The Headache and Costs of Transporting, Storing, and Maintaining Heavy Equipment
Whether your enterprise purchases new or used heavy machinery, you will need to have a designated site for storage of the machinery when it is not in use. An additional cost at the time of purchase will be a trailer as well as a suitable vehicle for transport to sites. The machinery could be an oversized load that may require a permit to be transported on public roads with an accompanying guide car. An employee or private contractor will need to be tasked with maintaining the equipment to prevent delays in time-sensitive projects.
Renting equipment means the storage, transportation, and maintenance headaches fall squarely on the shoulders of the rental company. This saves money since you do not have these overhead costs and wasted time that detract from your bottom line. Also, getting the right machine as a rental means there is likely no delay in getting it on board and out to the job site. Purchased heavy machinery can take weeks or months to arrive. Meanwhile, you have downtime, or you cannot pursue additional projects, limiting revenue opportunities.
2- Liquidity and Depreciation Issues
For a smaller construction firm, you need to stay lean and mean. If you have a lot of capital tied up in a major purchase, you may not have enough liquidity to take on other projects or purchase additional machinery. When your company no longer needs or uses the purchased equipment, you will likely need to try to sell it in order to free up space and minimize depreciation losses.
3- Access to Just the Right Machine Suited to the Job
Any heavy-duty machine rental company worth its salt is going to replace its equipment with state-of-the-art machines as needed. They will also stock a variety of rental machines that are tailored to the size, requirements, and constraints at your site. Maybe you need just the right length of conveyor or just the right type of screener. Getting just the right machine will help your enterprise complete tasks more efficiently than using an aging machine that is not suited for the current job. That can lead to higher labor costs. Also, the rental company will give you the opportunity to try out different types of machines.
4- Using a Contractor or Subcontractor to Handle the Materials Onsite
Counting on the availability of a contractor or subcontractor to perform your material-handling tasks can introduce unnecessary costs and preclude you from other job opportunities. The required material handling task may not be performed up to your standards, potentially causing conflicts or discontent with your client. If your contractor fails in the task for any number of reasons or does not perform in a timely manner, you are back to square one.
Renting the right heavy-duty machine will help you keep labor, storage, and maintenance costs lower. You will have greater access to the most efficient machinery without tying up a bunch of capital. Thus, renting your heavy machinery is more financially nimble, and provides your firm a greater ability to procure more plum projects.
