Heavy equipment rentals are increasing across North America and the trend is expected to continue: the US rental market is expected to grow 4% between this year and 2024.
Is it really more cost-effective to rent rather than buy? Is renting construction equipment the best option for you and your company?
The key driver for growth of construction heavy equipment rental is “the bottom line.” Because of the project-based nature of the industry, equipment is often left unattended until it’s time for the next new project, which can lead to equipment depreciation. Rental fees are often an immediately deductible business expense, rather than a depreciating asset of a longer period of time, meaning construction businesses can immediately benefit from renting.
Additionally, there are other benefits to renting rather than buying construction equipment, including minimal maintenance costs, the opportunity to “upgrade” your equipment as necessary and eliminating the cost of storage space. In short, renting instead of buying heaving equipment is a net benefit to many smaller to mid-sized companies.
Renting equipment also gives construction managers the change to try out construction equipment before deciding to buy, if they are considering that option.
Of course, there are many scenarios where it makes more sense to buy your equipment instead of renting. If you are using certain equipment almost every working day and you have the capacity to store and maintain it, owning will likely be more cost-effective than renting in the long-run.