Buy, Lease or Rent Construction Equipment?
Without the right construction equipment, timely completion of a project can quickly be jeopardized. That's why most companies maintain a pool of machines like excavators or wheel loaders that can be rented anytime. Companies want to deliver reliable work even during growth periods or when executing special projects.
How can your equipment fleet help increase your company's reliability and profitability?
Benefits of Renting Construction Equipment
The trend of renting equipment has become established across many different industries. In the construction industry too, the concept is attracting significant interest. Beyond financial savings and increased flexibility, the maintenance resources saved on equipment also support the rental model.
Renting construction equipment comes with many advantages – here are the most important ones:
- guaranteed availability of construction equipment
- extensive selection
- find equipment nationwide for projects – including specialized machinery
- costs only accrue for working days
- no expenses for maintenance or repairs – full service from the rental provider
- usually 100% of rental costs can be deducted for tax purposes
- simplified budgeting, as costs typically only arise once a project has been awarded
- short-term equipment failures have no impact on customer relationships
- spare parts can easily be rented and returned free of charge when not in use
- rental equipment is always up to date with the latest technology
- rental costs are often tax-deductible
- no loss or theft risk, as rented equipment is fully insured
Benefits of Buying Construction Equipment
What advantages does buying construction equipment offer? Owning your own small fleet can certainly make sense and offers these advantages:
- your own equipment that your employees are familiar with
- guaranteed availability of construction equipment
- tax benefits (depreciation, investment allowances)
The Benefits of Leasing Construction Equipment
The third option alongside renting or buying construction equipment is leasing, which has the following advantages:
- own equipment for a certain period of time
- guaranteed availability
- spreading the investment over several months
- usually 100% of lease payments can be deducted for tax purposes
When Does Buying Equipment Make Sense?
For frequently used equipment like mini excavators, wheel loaders or compaction plates, a purchase will likely be worthwhile in the long term. These are used almost constantly, and employees have equipment they know and can rely on. However, for peak project periods or special applications, additional equipment is often needed. In such cases, companies must decide whether purchasing additional machines makes financial sense.
What Should You Consider When Deciding to Buy Construction Equipment?
When you buy equipment, you must also handle repairs and maintenance and cover the associated costs. If it's really just project peaks or seasonal uses like winter maintenance, buying is not an economical option due to the high upfront investment. Leasing construction equipment becomes more attractive in such cases.
When Does Leasing Construction Equipment Make Sense
You have a new machine for the lease period, which returns to the lessor after the contract ends. This way, you always have access to relatively current equipment that meets modern technical standards. With longer lease terms, investments in a new wheel loader or mini excavator are also spread over a longer period and don't burden the company with a large upfront payment. This preserves equity and looks good on the balance sheet. Over the lease term, companies can deduct 100% of lease payments as expenses, which is an attractive option compared to purchasing, which must be depreciated over several years. However, such lease terms are usually at least 12 months, which ties the company to the equipment for a relatively long period.
But: Leasing isn't really a flexible solution tailored to specific project needs.
Gain Flexibility by Renting Construction Equipment
If you want to flexibly adjust your fleet and manage your construction equipment inventory clearly online, then digital rental of construction equipment is the right way. Renting not only enables you to find the right construction equipment for your specific project, but also allows your company to work across regions and rent equipment locally. This saves on transporting your own machines. Of course, as a renter you always get current equipment in technically perfect condition. As a renter, you don't have to worry about maintenance and repairs and receive comprehensive service from the rental provider. The biggest saving comes from renting because you only pay rental and insurance costs for the actual working days.
Renting Construction Equipment – The Best Solution
Ownership means responsibility. If you want to own a construction machine, you must also cover repair and maintenance costs as well as spare parts expenses. Therefore: if equipment is only needed temporarily (such as for seasonal use), buying is not a recommended option due to relatively high acquisition costs – in such cases, renting equipment as needed is definitely the better approach. The same applies if, as a contractor, you need expensive specialized equipment to complete a construction project or frequently work at different job sites.
