It’s Decision Time—Should We Buy or Rent Our Next Forklift?
The time has come when you need to add to your forklift fleet. Perhaps your business has grown, and the demands of your forklift fleet have increased. Or maybe it’s time to replace an aging lift truck. The big question remains—should you buy or rent and how do you decide?
There really is no right or wrong answer. Like anything else, there are pros and cons to both renting and buying equipment, so it’s important to evaluate your company’s current situation and match it with your plans for growth. Here are some key points to consider in the process:
Assess your financial situation.
- Look at your capital flow. Renting a forklift doesn’t require as much upfront capital as purchasing does.
- In most cases, you don’t have the extra expense of maintenance when renting. But the cost is likely built into the cost of renting.
- Buying a forklift may be better in the long term if you use the forklift often. And, it would be available 24/7 whenever you need it.
- When you buy or finance your purchase, the forklift becomes an asset to the company.
- If purchased, you get a return on your investment when you no longer need the forklift, and sell it or use as a trade-in.
Evaluate the costs of ownership vs. renting.
- When you buy a forklift, you should take into consideration the costs to maintain and service the equipment. Safety concerns, insurance, fuel, batteries, etc. all come with purchasing a forklift.
- When renting, the maintenance, insurance, and additional expenses are usually handled by the rental company and built into the cost of renting.
- Some companies may find it easier to budget for a rental payment rather than the uncertainty of those extra expenses.
- Leasing with a full or complete maintenance plan is another way to get into a new truck with a fixed monthly cost.
How often will the forklift be used? Is the need immediate?
- Does your operation require consistent daily use, or are your lift trucks used on an as-needed basis with short runs?
- High-frequency use of your forklift would more than likely call for purchasing over renting. At a certain point, renting for the long term will become more expensive than owning.
Compare Costs and Tax Situation.
Every business situation is unique. Be sure to check with your accounting department for the cost factors used to help accurately assess rent-or-buy decisions. Also, equipment vendors and/ or manufacturers may be able to provide calculators to apply to specific equipment the data necessary to determine the best course of action.  Also, discuss the tax implications of purchasing vs. renting. Tax laws vary from state to state. Do your research on costs—then speak with a tax professional to understand all the financial implications of your decision.
To summarize, there is much to consider before deciding to purchase or rent your next forklift. If you are having difficulty with the decision, reach out to one of our qualified material-handling professionals today. We sell new and used forklifts of all types, and we offer one of the largest material-handling equipment rental fleets in Northeastern PA. At Action Lift, we’re happy to help you make whatever decision is best for your business.