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He recommends purchasing the machine if you expect an annual time utilization of 60% or more based on 22 days of use per month.
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“Because you are committing to at least a 60- to 72-month financing payment cycle, you had better be sure you have the work over this time period to cover cash flow requirements.” “The ‘buy’ conclusion has to be based on future utilization,” says Garry Bartecki, managing member of GB Financial Services LLP, and a consultant to the Independent Equipment Dealers Association.
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Of these, expected utilization typically tops the list.
Trail dozer rental upgrade#
Rental companies upgrade their fleets on a regular basis, giving contractors access to the most advanced gear and latest in control and operational technologies,” said Craig Schmidt, vice president, United Rentals. “Another benefit of infusing rental equipment into a fleet strategy is the access to newer and more advanced fleets. You don’t have to worry about depreciation, interest allocation or insurance.
Trail dozer rental plus#
As a generalization, a longer-term rental over multiple months will typically run 4% to 5% of the cost to purchase plus you avoid the sales tax required with outright acquisition. Availability of capital: Renting can help to maintain financial fluidity during times of uncertainty, such as we saw throughout much of 2020 and into 2021.A number of factors have driven this trend. Rental’s RewardsĬompact excavators have grown to become a high-volume rental item.
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There can be benefits to each, but they depend largely on the situation and equipment utilization. Leasing throws yet another potential acquisition option into the equation. The question becomes whether it’s more practical to buy the unit and have it on hand when and where it’s needed, or if it’s better to rent until you know you have both the project backlog and mix to justify the purchase. The investment in even a smaller machine such as a compact excavator becomes a major decision. The uneven recovery in construction activity coupled with uncertainty about equipment availability and prospects for future work make for tough choices when it comes to acquiring equipment.