TO RENT OR PURCHASE A BALER OR COMPACTOR – OUR GUIDE
All businesses need equipment, from standard office and IT equipment through to operational equipment and even vehicles. For most businesses, the choice is between the purchase of capital equipment or rental, however, it isn’t always a simple choice.
The decision to buy or rent will be unique in all cases and will be dependent on the particular needs of the business and the equipment. In some cases a capital investment will be the best strategic decision, while in others rental offers a more suitable solution. In tough and uncertain economic times many business will be advised to consider each case and requirement carefully.
Many market and wider economic factors will influence both the markets for purchase and leasing. Figures released in December 2016 by the Finance & Leasing Association (FLA) showed that asset finance new business (primarily leasing and hire purchase) grew for the thirty-seventh consecutive month. The business equipment finance and plant and machinery finance sectors grew in October 2016 by 16% and 10% respectively, while commercial vehicle finance fell by 1% over the same period.
To help understand the benefits of both purchasing outright and renting we have produced a handy guide to both options.
Purchasing an asset outright
Buying equipment outright can be a sensible option if you have the available capital or if it is essential that you own the equipment. However, during challenging economic climate, large scale capital expenditure cab affect your cash flow. If your marketplace is experiencing a period of uncertainty it can be wise to safeguard cash flow as a buffer to any potential down turn.
Rental
Paying for goods on rental of equipment allows you to use an asset over a fixed period in return for regular payments, with rental deals available at very competitive rates. You simply choose the equipment you require in return for paying a rental fee each month. This arrangement will also typically allow you to benefit from owning the latest and most technologically advanced equipment, with suppliers often providing upgrades to the latest models, and without having to pay up front.
The smaller payments associated will leave you with more cash, however you should remember that you will not own this as an asset after the rental term. However, long term increased costs are often offset by the savings in costs and productivity that having the latest new equipment provides. While you may never own the asset outright, you can often upgrade your equipment without the expense of buying newer models and without the worry of owning a depreciating asset that will inevitably need to be upgraded. When the rental period finishes you simply hand it back, exchange it for the latest model and keep the model that works for you.
Full maintenance and service is offered as part of a rental contract with Orwak Easi, which gives considerable piece of mind and reduces lost production time.
Whatever you Baler or Compactor needs, and whatever your budget, Orwak Easi offers both the option to purchase or rent. Contact us here or call 0800 342 3177 for a no obligation assessment of the best option for your business.