To Hire or Buy Landscaping Equipment In Uncertain Times?
Buying sensibly can motivate success. Hiring efficiently can reduce costs
With times being so tough, which way is best to go? Whether you have a one man lawn care business or are a Landscape contractor, a large landscape maintenance or construction company, or a council parks and gardens department, the issue of ‘hire versus buy’ is bound to raise its head at some point. When you are considering buying or hiring, it’s necessary to evaluate the number of times and the duration that workers need the equipment.
Other considerations are evaluating your budget, equipment maintenance, and the space you have for storing the equipment. There are both economic and convenience reasons to either hire or buy, so it’s not always an easy choice. Sometimes buying equipment can motivate you to chase work harder, and makes you more competitive.
If cost was the only issue, perhaps more equipment would be hired. Accountants would say, add up the cost of equipment, the service cost, storage cost, the cost of the finance, insurance, and tax implications then spread that over 4 or 5 years. Then work out how often you use the equipment, work out the hire costs over 4 or 5 years, and then compare the two. If hire is better value, then hire, if buying is better value then buy. However, it is not quite that simple. Convenience of owning equipment should be considered if the costs are close. If work is currently slow, hiring extra equipment for the short term may provide you with breathing space, before hard decisions are made. But remember there are some intangible cost and quotation advantages to owning your machinery.
Calculating these costs is often hard, so one way to do it, is to consider the use of the equipment. If it is used almost every day, then buying makes sense. If it is a specialty piece of equipment you use spasmodically, then hiring would be the best way to begin with. This is the easy option. Hire for a while first, then if you are hiring that piece of equipment regularly, it maybe time to consider buying. Core equipment that is used very regularly is usually better to buy, but before the purchase, it is often worth hiring a few different models first, so you can see which style of equipment better fits with the operation. Using Zero Turn mowers for example, it may be worth hiring a few different sized mowers, to find out which type suits your sites best.
Buying sensibly can motivate success.
In a competitive world like today…read more