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Buy or rent a forklift?
Many companies face the question whether to buy or rent a truck. There are, of course, advantages and disadvantages of both choices, which is why it can be difficult to choose. It could be inviting to buy the truck when the capital exists and the feeling of not having to pay interest is always attractive. But have you considered if that money could be invested in anything else that gives more return? If so, what are the advantages of renting the truck?
This guide can help you to understand when it is suitable for a business to rent or buy one or several forklift trucks.
How would you like to use your capital?
You have money to invest
Buying a truck can feel right if the money exists and a new (or used) truck is needed for the business. Generally speaking, there are of course better things to invest in because a truck, just like a passenger car, directly loses value. But if the company's policy is that you should own all the machines and trucks, you should of course do so.
A self-owned truck will be an asset on the balance sheet and you can do as you please with it without being worried about what those who own the truck should say when the contract or lease ends.
You prefer to have a fixed monthly cost
If you rent your forklift(s), you can invest the capital that had been spent on buying the truck(s) in other things that can develop the capital for your business. Forklift rental also allows you to reduce costs when you are not in need of as many trucks. You will have less trucks standing still when the equipment need is not that high.
If there are also low interest rates, there is little reason to tie capital in a truck that quickly drops in value. However, be careful that who you rent from are authorised and the truck is checked. Watch out for short-term rent which turns into a long period as the price is often high, it is cheaper to rent for a longer period from the start.
What level of flexibility do you need?
High level of flexibility
Forklift rental, especially for a short period, offers a good and flexible solution to cover busy times or peak seasons. The hire period can be really short and prolonged when needed.
The type of truck can be chosen and changed and truck options can be discussed and adapted to your needs during the contract.
Flexibility is not so important
If your business is less sensitive for fluctuations in demand, less flexibility in resources and equipment is needed. Your owned fleet will do the job.
How do you keep uptime high?
Include service
When owning your trucks, you are responsible for maintenance and repair. Ask your material handling supplier what service packages they can offer to ensure uptime of your fleet. Preferably a yearly regular service visit to reduce the risk of a breakdown. Ask yourself how long you can be without the truck if something should happen.
Renting forklifts for a shorter or longer period is a good alternative to avoid the high initial cost and you get service, spare parts and technology included in the contract.
Back-up trucks
Short-term rental is a good solution when a truck breaks down and you quickly need a replacement.
Pros and cons: the summary
We listed up all the advantages and disadvantages that come with renting or purchasing a forklift.
Renting a forklift
+ High flexibility when you have high season/seasonal stop/ uncertainty about the demand in your business
+ Fixed monthly cost
+ Maintenance and repairs often included in the contract
+ Get your truck quickly: the time from order to delivery is often very short, sometimes within 24 hours.
+ You can return the forklift at the end of the contract
Buying a forklift
+ You own the truck and can do whatever you want within the framework of the CE marking
+ It is an asset on your balance sheet
- You have to make sure that the truck lives up to the requirements that exist
- You are responsible for maintenance and repair
- It’s an investment that binds capital
- This makes your truck fleet less adaptable
- The truck is rapidly decreasing in value
- You must take into account unexpected costs such as the hire of spare trucks to cover in case of a major breakdown.
- You will need to sell or scrap the truck when it is no longer needed
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