If you own a construction company, you may think it's time to start purchasing your own heavy equipment. However, that might actually be the last thing that you want to do. You may be better off if you continue to rent your heavy equipment. It's true that you won't own the equipment you're using, but that's not necessarily a bad thing. In fact, it might turn out to be an advantage, especially when it comes to financial matters. Here are four reasons why you should construction equipment rentals could be more beneficial than purchased equipment.
No Need for Big Cash Investment
When you go out to purchase your heavy equipment, you're going to need to make a big cash investment. The cash you use for that investment will come from other areas of your operating budget and might actually be money that could have been earmarked for expansion or other business-increasing ventures. If you continue to rent your equipment, you won't need to make that big cash investment, which means you'll be able to use that money for other business purposes.
No Additional Storage Costs
When you own your own heavy equipment, you've got to have a place to store it at the end of the day. That means you'll need to invest in a larger facility, or pay to rent a storage yard for your equipment. That's additional money that will be taken away from your operating budget. However, when you rent your equipment, you don't need to worry about those storage expenses. Once you're done with the equipment, it will simply be returned to the rental company.
No Need for Increased Site Security
When you invest in heavy equipment for your construction company, it becomes imperative that you increase the security around your construction yard, since the last thing you want is to have your investment stolen out from under you. Unfortunately, providing security for your heavy equipment can be quite costly. Luckily, you won't need to worry about the increased security when you rent your equipment.
No Damage to Your Credit Standing
When you purchase heavy equipment, you'll probably need to secure financing for the purchase. Once you finance your equipment, it will show as a business liability on your credit report, which means you might have a difficult time obtaining financing for other ventures. This is especially true if it looks like too much of your income is tied up in your heavy equipment costs. When you rent your heavy equipment, however, your credit won't take a hit and you'll be able to utilize your income for other purposes.