Renting equipment is quickly becoming a popular alternative to owning equipment. More and more companies are switching to renting because of its many benefits. The benefits of renting verses owning include:
In fact, renting is frequently chosen over owning when there is a:
- Renting is less expensive than buying if the equipment is used less than 70% of the year.
- Rentals free up cash tied up in owning hard assets, converting fixed costs into variable costs.
- Pay for what you use, not what you own.
- Renting gives you access to the newest and most appropriate equipment.
- Using the right equipment for the job will increase efficiency and save you money in the long run.
- The owner frequently covers the maintenance costs of the equipment.
- Break-downs due to normal wear-and-tear are not the responsibility of the renter.
- Idle equipment can be taken off rent to save money and storage space.
- Renting equipment for an out-of-state project is cheaper than shipping in your own equipment from further away.
- Owners incur the disposal costs at the end of the useful lifetime of the asset.
- When you rent equipment you are not responsible for licensing costs.
- Rentals allow better debt-to-equity ratios.
- Rental costs are tax-deductible in some cases.
- Renting is in line with the worldwide trend towards outsourcing, allowing resources to be dedicated to core activities.
- Desire to increase the capital base but not the capital investment.
- Need for the use of a piece of equipment which cannot be purchased.
- Desire to try a product or experiment with other models, brands, etc.
- Desire to save storage space.