Construction company owners and contractors often need to decide if they should lease or buy the heavy-duty crane they will need for their projects. There are advantages and disadvantages to both arrangements, so consider a few simple tips about each choice. This can help you to determine which is the best option for your needs.
1. Note how quickly the equipment will depreciate
Depending on the type of jobs you will be using the crane for, it may depreciate very quickly. In that case, it might be best to simply lease the crane with a fair market value clause. This allows you to turn the crane back into the company from which you lease it after the lease is done or buy it for its fair market value. If it won't depreciate very quickly, you may find it's better to invest in the purchase price so you can continue to use the crane for years after a lease would be over.
2. Remember that you'll need to have an operator you can keep on staff if you purchase
Operating a heavy-duty or overhead crane usually means having a specialized operator with certifications that need to stay current. If you're considering purchasing a crane, you need to ensure you can keep such an operator on staff. In some cases, short-term leases come with operators who will work the crane for you. You can lease the crane for a few weeks or months to complete certain jobs and a leasing company, such as http://wazeeco.com/, will provide an operator so you don't need to worry about always having one on staff.
3. You may want to lease additional equipment down the road
Leasing a crane gives you the opportunity to wrap it with other leases for additional equipment, or to turn in one crane and opt to lease another one while being able to wrap your current payments into payments for the new crane. When you purchase a crane you don't have these options.
4. Owning a crane can give you capital if you need it
When you lease equipment, you are obligated to the terms of the lease no matter the financial status of your company. When you own equipment, you can sell it to raise capital if needed. A crane can be part of a leaseback program, where you would sell your crane to another company and then lease it back from them. This gives you working capital but also access to the equipment you need. You don't have this flexibility with a crane you lease.
Only you can determine the best choice for your company but consider these factors to help you make that decision.