As many in the industry have noted, heavy equipment sales worldwide have greatly increased over the last few years. Volvo recently reported a 27% increase in sales for 2018 and Caterpillar reported a similar 2018 gain of 20%. All of this growth has lead some in the construction and mining industries to wonder: Should we stop renting and start buying instead?

The short answer is: It depends. Every company is different and the decision to buy should be made based on the particulars of your company's current financial situation as well as your brand's specific long-term needs and objectives.

That said, we've compiled a list of buying and renting pros and cons in order to help simplify the decision-making process.

When should you rent?

Renting may be your best option if you meet one or more of the below criteria:

• You lack storage space--Storing a large piece of heavy machinery can be expensive, as it requires a covered, dry space as well as anti-theft security measures. If you don't have access to a storage facility, renting may be a more affordable option.
• You lack technicians and delivery drivers--It's important to keep in mind that the machine's listing price isn't the only expense related to purchasing heavy equipment. Buyers also need to budget in the cost of hiring the necessary technicians and drivers in order to ensure the equipment is maintained, repaired and delivered on schedule to and from the jobsite. When you rent, on the other hand, the rental company handles any needed maintenance or repairs, often directly from your jobsite, as part of the cost of the rental. If you don't have the manpower or resources to maintain and transport heavy equipment, renting may be the better choice.
• You only need the equipment for a short period of time--In most instances involving short-term or one-off projects, it makes more financial sense to rent. Buying should be reserved for long-term projects or if you foresee needing the equipment for multiple jobs.
• Your project requires a specialized piece of equipment--When you buy, you're often forced to select a versatile machine that you'll be able to use in a wide variety of jobs. When you rent, on the other hand, you have the freedom to tailor your choices so that you get the exact size you need. Surprisingly, renting in these circumstances can actually save you money, as you aren't stuck having to use a bigger machine that requires more fuel or power than is necessary; you can choose a machine that fits the precise requirements of that specific job.

When should you buy?

Buying may be your best option if you meet one or more of the below criteria:

• You have the resources to purchase--Money and a good credit score isn't all you'll need to buy a piece of heavy machinery. You'll also need to ensure you have the storage space and the employees on staff to maintain the equipment and deliver them to your various jobsites.
• You plan on using the machine more than 65% of the time--The general rule of thumb to follow is this: If you're using a machine more than 65% percent of the time (or for eight or more months a year), then buying is often the better option.
• You require the flexibility--Owning a machine comes with a certain level of flexibility that renting does not. When you own a machine, you can react quickly to changes in your construction schedule and can adapt easily as project needs change.
• You need a multipurpose machine ­‑- Good items to buy include multi-purpose tools like generators, rotary hammers or drills. You may also want to purchase the machines you use most commonly, like wheel loaders or backhoes.

Renting vs Buying:

Should you rent or should you buy? Ultimately, the answer to that may not matter as much as you think. Many companies have found that what works best for them is to do both. They buy frequently-used and multi-purpose machines and then they rent the specialized and expensive machines.

Rent, Buy or Sell - Blue Diamond Machinery Can Help

Blue Diamond Machinery offers a variety of name-brand construction and landscaping equipment at affordable prices, servicing commercial construction companies across Nevada, Utah and Idaho. Whether you're looking to rent, buy or even sell, our growing team has over 65 years in the construction industry, and can use that expertise to help meet your heavy equipment needs. Our company motto is: "Giving our best for your success."

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