Rent or Buy: Which is best for you?

Deciding to rent or buy a forklift in Dallas or Fort Worth, Texas has become a lot easier. At Ace Equipment, we offer both! Our experts have the knowledge in forklift sales and rentals that help make the decision easier for you. The answer to the question, by the way, is that is simply depends. The rule of thumb to follow is that if the value of the forklift will increase over time, then you should buy it. On the other hand, if using the forklift over time will decrease the value, then maybe renting would be the best financial decision.

Now, does that really work? We know a forklift is not gold or a diamond, so, logically, this equation is not always applicable. Some reasons to buy the forklift include if you use it for more than 1,000 hours a year, your equipment has low service and repair requirements, and if you have no concerns with capitalization and depreciation of your assets. In this case, you can afford to purchase the forklift without losing money.

On the other hand, if you operate a forklift for more than 1,500 hours a year, have a strenuous workload, and your operations will increase in the future, then you should lease a forklift for a period of 48 to 60 months. Leasing is a good option for companies that have a high cycle operation, a predictable utilization (frequent), financial constraints, and off-balance sheet transactions. When you lease the forklift, you are not fiscally responsible for its maintenance and can return it.

Leasing pros for your company are vast, including lower monthly payments, tax advantages, conserved capital, and immediate access. Leasing will minimize your cash flow demands, eliminate the concern for return on investment, and keep your bank credit higher. The cons of leasing are correlated to price and time. Higher interest rates may mean you pay a higher price over time. When you lease a forklift for 48 to 60 months, that means you are stuck with it unless you want to break your lease. So, checking your pros and cons list is important before you make a decision.

Buying a forklift means you have ownership, you can use it however and whenever. The cons of buying are related to liability and cost. When you buy the forklift, initially, there will be a high cash outflow along with the costs of all repairs and maintenance. Many times, when a business buys a forklift they have to perform maintenance using old parts. The biggest pro is that there is a fixed price for the forklift that you give once, and the rest is your verdict.

Businesses that are heavy forklift users will see a cost advantage when they buy, and these are usually larger companies who have the cash flow along with staff. Larger companies also have the ability to turn around their investment while not worrying much about superficial damages to the forklift or maintenance costs.

For any questions about your forklift, contact us at Ace Equipment in Dallas and Fort Worth, Texas today!