Nowadays, many construction companies are choosing to rent their heavy construction equipment instead of purchasing it. Here are a few reasons why:
They may only need certain equipment for one particular job
If a construction company only needs a piece of specialized equipment for one particular component of a single job, company owners are more likely to rent the equipment. Financially, it simply makes more sense to rent a piece of equipment that if purchased, may sit dormant for an extended time after the current job.
Many construction equipment rental companies permit rentals by the day. Thus, construction companies do not have to commit to weeks or even months of renting. A company that only needs a piece of equipment for a small period can rent the needed equipment and then return it as soon as it is no longer needed without incurring unnecessary costs.
They may not have the money or credit needed for a purchase
Although most companies don't have to offer the full purchase price for a piece of construction equipment upfront, even a down payment can be expensive. Construction equipment can cost hundreds of thousands of dollars, and a down payment can require a large amount of liquid funds. In addition to the rental cost being far below the purchase price of the equipment, the rental price will likely be much less than a required down payment.
Also, purchasing equipment without presenting a large down payment can require a high credit rating with a strong credit history. A relatively new company may not have been in business long enough to have established a high level of creditworthiness. Although a company's credit may be checked before a rental is approved, the credit rating may not be as important as it is for a purchase, especially if the company's liability insurance will cover the construction equipment while it is in the company's care.
They won't be responsible for maintenance costs
The cost to maintain construction equipment can be substantial. However, when a company rents a piece of equipment, the burden of upkeep rests with the rental company that owns the equipment. Therefore, the renting company is not required to spend money for regular tune-ups, repairs and other maintenance as it would if it owned the equipment.
To learn more about renting construction equipment and to review a list of available pieces of equipment for rent locally, contact a construction equipment rental company in your area.