The Cost Effectiveness of Equipment Rentals
Posted on: 28 April 2020
A large number of building contractors choose to hire earthmoving equipment rather than purchase their own equipment. Considering that construction is the main business activity for a building contractor and that they have to use earthmoving equipment on every site they work on, one might wonder why building contractors should not simply purchase their own earthmoving equipment.
Well, it all boils down to the cost of owning such equipment. Apart from the fact that the initial cost of purchase for earthmoving equipment is quite high, the cost of equipment ownership can also be quite high. Here are a few reasons why hiring earthmoving equipment is a cost-effective alternative.
Maintenance Related Costs
Earthmoving equipment, such as bulldozers and excavators, need regular maintenance in order to ensure that such equipment is safe for use and in order to increase the durability of the said equipment. The cost of maintenance for earthmoving equipment includes the cost of regular safety inspections that are mandatory for such equipment, the cost of repairs in the event of equipment breakdown and the cost of replacing worn-out components within the system's engine and body.
The mentioned costs can amount to a huge sum and a building contractor might not be able to meet these costs, especially if he or she does not hire out the said equipment.
Costs Related to Storage
For one, you know how big an excavator or a backhoe loader is. Therefore, investing in personal earthmoving equipment will require the building contractor to spend more money for the storage of such equipment. This will probably mean that the contractor will be forced to hire out a yard or a similar space for the storage of personal earthmoving equipment and this can be quite the cost. For this reason, a majority of building contractors would rather hire earthmoving equipment and let the equipment rental agency worry about storage-related costs.
The Depreciation Factor
Earthmoving equipment does not appreciate in value once it has been bought. Rather, its value continues to depreciate with continued use of such equipment and with the manufacture of new models that often have superior qualities.
Therefore, the expected cost of depreciation is often enough to make building contractors opt to hire earthmoving equipment from equipment rental agencies rather than purchase their own equipment.
For many contractors, equipment rentals are a more cost-effective option, and hiring earthmoving equipment is often more practical than purchasing the said equipment. Hiring an earth moving contractor if no one is trained in the use of excavators is also a good idea.
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