Owning and running both small and large businesses can be complicated; there are various factors one needs to consider in order to keep operations running smoothly. One of the most important factors to consider is the issue of financial administration and keeping costs within the company’s budget. Of course, hiring a bookkeeper or accountant to assist in maintaining the budget is beneficial; however, the decision on expenditure will fall to you at the end of the day. An expense when working in the construction or farming industry is that of equipment, and a great expense it can be too. This article will examine the hiring of plant machinery and how hiring used can help reduce company costs.
What Is The Difference Between Hiring And Purchasing Equipment?
The first question to ask when looking for the right plant trader to obtain plant equipment is – to hire or to purchase? It can be argued that purchasing plant machinery can be a strong overall long-term investment; however, the initial capital layout can, in many cases, exceed the budgetary allowance. This is particularly evident among smaller companies or new companies that do not have a large capital available. For these companies, the option of hiring machinery would be more beneficial as the overall cost of purchase, along with necessary future maintenance costs, is eliminated. It is possible to hire new equipment; however, this can be expensive and for companies with low budgets it is recommended that option of hiring used plant machinery be considered.
What Are The Advantages Of Hiring Used Plant Machinery?
The core advantage of hiring used machinery is to assist with reducing company costs in general. In many cases, rental companies will ask for an initial deposit and used machinery rental companies are often pleased to allow for monthly or quarterly repayment plans. This will spread the repayment of the deposit avoiding the need for a full initial payment. It should also be mentioned that some rental companies provide lease agreements containing a clause that allows upgrades should an updated model become available. This is useful as the company is then able to utilize an updated machine without the need for additional cost.
If the plant machinery unfortunately breaks, the cost of maintenance and repairs will not be placed on your company. When using a rented piece of equipment, the leasing company will typically source a replacement machine as part of the contract. Of course, you should always read the contract carefully to determine whether or not this is on the lease and if there is a need for additional payment; generally, there is not.
What Are The Disadvantages?
As with all aspects of work, there are advantages and disadvantages to the renting of used plant machinery. The advantages are a reduction in company costs; however, unless the lease clearly states otherwise you may lose the equipment should the company experience financial problems. It should also be noted that, unless clearly stated in the contract, the machinery will not be considered yours even if you offer to purchase the item.