There’s no doubt that owning a piece of machinery is an alluring proposition that many (inexperienced) companies fall for – after all, being able to tell your clients that the machinery belongs to you and that you have everything you need is a big bonus when it comes to marketing. Unfortunately, it’s not that practical, and it’s really not the right choice for most companies. In fact, purchasing construction machinery outright may actually be a big mistake.
Smart companies hire rather than buy, and for many reasons. The uncertain future, together with a more stable cash flow and the ability to stay up-to-date drives more and more construction companies to hire (and we haven’t even mentioned practical considerations such as maintenance yet). Here’s why more companies are looking to hire rather than purchase construction machinery.
You pay when it’s used
When you buy equipment, you’re paying for the machinery even if it’s in a storage unit or warehouse and without productivity. When you hire, on the other hand, you are sure the money you pay is for useful and constructive purposes. There’s no downtime you have to worry about. Furthermore, if the machine should break down or be in need of repair, it can be replaced. You pay for productivity.
The best technology
Being up-to-date is very important in this modern world, as everyone subscribes to the philosophy of efficiency, and competition is fierce. When you hire, especially when you hire from plant hire Chesterfield professionals like Ruttle, you are sure that you have the latest equipment to serve your needs and don’t have to accomplish a certain job with an outdated machine.
When you buy, you not only have costs regarding the purchase itself – all the expenses regarding maintenance and storage fall on your shoulders as well. You don’t have those headaches when you decide to hire your equipment.
Easy cash flow
As per your contract, you have an easy-to-predict bill on a periodical basis, and this does wonders for your cash flow as you can forecast and make much better management decisions.
Construction is an unpredictable industry, and you are never quite sure where the next project will come from, or what equipment you might need. Hiring eliminates a lot of risk.
Here’s one more thing that should be seriously considered before you decide to purchase or hire: hiring your plant or construction equipment is a lot more beneficial when it comes to taxation purposes. The purchase of a machine will be recorded as a capital gain, whilst hiring will be recorded as a simple expense. As any accountant will tell you, the consequences often reach far: your taxation bill can be significantly reduced – and that means more funds available to plan for the future.