Saturday, March 3, 2018

Do your competitors own or rent the equipment you see on the job site?

The answer may surprise you.

There was a time when the “little guy” felt intimidated by the “big guys” that owned their equipment. If you haven’t been paying attention, you should know that times have changed.

According to a lot of recent research, more are renting than own the equipment you see on the job site. 

While this may or may not be the case for you, I wanted to share some of the more common reasons this number is steadily rising. If you are considering purchasing a new or used piece of equipment, consider this;

• If you are shopping the used equipment market, what you are looking at is likely not Tier 4 emissions compliant. Today that means you can’t use your equipment on most federally owned land. I suspect our State will soon follow and have heard of private entities requiring the same. 
• New equipment that is Tier 4 compliant requires a much higher level of expertise to diagnose and repair than the older equipment did. These expenses aren’t usually predictable and are hard to include in a job bid. 
• Technology is changing fast, what is acceptable technology to be competitive today, likely won’t be just 5 years from now. Will you eat the depreciation and buy new again so soon? When things didn’t change a lot from one year to the next, there wasn’t near the push to stay updated as there is now. 
• If you are growing your business, does this include moving into new geographical area’s? How will you move your equipment to the next location? Transporting heavy equipment requires a lot whether you hire it out or do it on your own. 
• Simple accounting and bidding. Rental costs have a lot less variability in them. In most cases X days = X cost. Add your margin to it and you have your line item for equipment costs. 

The list goes on from here, but these are the biggest reasons more equipment on the job site is now rented rather than owned. Currently the number is 53%, but it is steadily rising. 

Take some pressure off of yourself, let us handle the equipment expense, maintenance, storage, depreciation, and most repair costs. You mark up the rental cost and make money on it. 

The same applies to the homeowner. Storage and maintenance are the two killers for you. 

I can’t begin to tell you how many service requests we get for fouled fuel systems that sat too long. The shelf life of gas isn’t near what it used to be. We have had fuel go bad in as little as 30 days.

Rent it or own it? There are good reasons the majority are now renting.

When you are ready, remember our number 541-492-RENT (7368). 

Real live people by phone.

Roseburg 541-492-7368

Myrtle Creek 541-863-4385

No comments:

Post a Comment

Thank-you for taking the time to comment on our blog.