Comment by SoftTalker
2 months ago
And what blows my mind is that if I want to rent a tractor with a front loader for some landscaping work it’s hundreds a day. Yet even larger commercial earth moving equipment sits around unused for weeks.
2 months ago
And what blows my mind is that if I want to rent a tractor with a front loader for some landscaping work it’s hundreds a day. Yet even larger commercial earth moving equipment sits around unused for weeks.
Some of that may be due to the owner transporting it from job to job instead of storing it in their own yard.
Nonetheless, there's a lot of idle people/equipment in construction because things have to be done in the right order and sometimes it's more economical to over-provision than risk delaying the whole project because something wasn't available when it was needed.
Those hundreds per day will partly pay for all the sitting around unused in the hiring company's yard! You can see this in the pricing which is usually a lower rate if you hire it for a longer period.
It's about usable time and cost of capital - if it's cheaper to rent the unit, they'll rent one, if it's cheaper to buy one and let it sit idle most of the time, they'll do that.
The rent/buy calculus can be incredibly shunted towards "buy" once you're using it even somewhat. It's even more so when you realize that labor costs is the main issue, and not having a skilled worker waiting around for an item to be delivered (by another slightly less skilled worker, perhaps) is a huge savings in its own part. Five guys on a site might have 15 machines total; even though they obviously can't use all 15 at the same time.