Most construction jobs require the usage of very specific tools. These tools can get expensive, depending on their size and purpose. If you are completing a large job, or are just beginning your construction renovation business, it is possible that these tools are too expensive to purchase all at once. For this reason, construction and scaffolding rentals were made a possibility. How do you know if purchasing new or renting is the right financial choice for you?
Evaluate your cash amount
Starting a business requires money. You will find that you spend a lot of money, before you even begin turning a profit. If you are tight on money or are in those first few months of start up, you might want to consider renting. Scaffolding and other equipment can get very pricey, taking up much of your cash reserve. If this prevents you from paying employee wages, purchasing transportation items you need, or paying for licenses and permits, renting might be the best option for you, for now.
Length of time in business
As discouraging as it sounds, most businesses fail in the first year or two. They either never had the tools to be successful or they give up too early. Before you shell out all of your money on new equipment, evaluate how long you have been in business. If you have been established for many years, and simply believe it is time to invest in your own equipment, then go ahead. However, if you just got into business a couple of weeks ago, hold off on those purchases. Wait until you have a good customer base and are making an income.
Amount of jobs
Some tools are useful, but only serve a purpose for very specific of jobs. If you are considering investing in your own equipment, consider how many jobs you will use it for. If it is a tool that you are constantly renting, it may be a good financial decision to purchase your own. However, if the tool, such as concrete tool rental or compaction equipment for rent is only used once or twice a year, you might be better off continuing to rent it. Begin a spreadsheet of usages and how much rentals cost, and figure out how many months or years it will take to get your usage out of the new item. In the construction industry, a general rule of thumb is that if you do not use a piece of equipment more than 60 to 70% of the time, you should consider renting.
Amount of time needed
The amount of time you need to rent a tool may also play into your decision. Construction equipment can be rented for any length of time, for example, from one day to as long as one year. However, it is important to remember that you are likely paying a daily, or monthly rental fee. If you suspect that you will need a tool for many months, and the rental fee is high, you may want to evaluate the price of a new tool.
Some tools can be very large and difficult to store. Items like ladder scaffolding may be tough to store if you do not have sufficient spacing. For the past couple of years, an estimated 51% of new construction equipment manufactured has made its way onto rental lots. If you are using equipment for your rental properties, it may be too difficult to store, making rental a better option for the best equipment.