Categorised | Business & Finance

Hiring Or Buying Machines: Which Is Best For Construction Companies?

High overheads are one of the biggest challenges that construction companies, especially new ones, face. The cost of materials and equipment is exceptionally high and a lot of construction companies run into cash flow problems because they can’t manage those overheads. Staying on top of your costs is one of the most important things when you’re trying to build a successful construction company and the major issue that you have to deal with is your machinery. If you are going to start taking on bigger contracts, you’ll need a lot of heavy machinery like excavators and bulldozers and they’re not cheap. The biggest decision that you have to make is whether you’re going to buy that machinery outright or hire it out for each job. There are benefits and drawbacks either way so you have to consider your own situation and decide which option is best for your business. These are some of the pros and cons of hiring building equipment. 

Initial Costs 

Hiring equipment can be more cost effective in some situations but it can also be more expensive in others, depending on how much you use the machine. For example, you don’t often use a bulldozer, especially if you’re doing more residential work, so dozer hire is usually your best option. But there are certain things like excavators that you’ll use a lot more often. In that case, it might not be as cost effective to keep hiring them and as long as you can afford the initial investment, buying may save you money in the long run. 

Maintenance 

Maintaining machines can be incredibly expensive and that’s something that you need to factor into your decision. If you’re hiring machines, you don’t need to worry about maintenance because all of that will be handled and paid for by the plant hire company. But if you buy the machines, you’ll have to deal with all of that yourself. You can reduce maintenance costs by looking after machines properly and performing routine maintenance like changing the oil and lubricating parts. 

Storage 

Another big problem with purchasing machines is that you’ll need somewhere to store them and that can be expensive. If you’re taking on larger contracts and you’re running multiple jobs at once, it’s likely that you’ll need a yard of some kind to store materials. However, you’ll need a much larger plot if you’re also storing all of your own machines there as well, and that’s another big cost that you have to bear. What you need to consider is whether the cost of hiring that land is outweighed by the savings that you make by owning your own machines or not. 

Insurance 

Building equipment is a common target for thieves because it’s worth a lot of money. Storing it securely is important but there is always the risk of theft, which is why you need proper insurance. If you hire machinery, you don’t need to deal with that but if you’re buying your own machinery, you need to factor that extra cost in as well. 

It all depends on your business and your specific needs but often, hiring equipment is best if you want to manage your costs effectively. 

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  1. […] already hold an office or a place of work, changing your location is much more than the property values might imply. It’s also important to consider the daily, practical functions of choosing such a […]


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