It’s no secret that the construction industry is currently in a stressed state. Several of our largest home builders have gone into liquidation. Although there is still plenty of work available and people are still spending money on homes and infrastructure building has not ceased, interest rates have not and continue to rise. And with the continued global supply shortage, the skyrocketing cost of materials and the uncertainty surrounding the construction industry now is the time to consider whether you should be buying equipment or hiring it for your future projects.
Construction Equipment Hire vs. Buy: What’s the better option?
There is no doubt that demand is at an all-time high for labour and construction services but this doesn’t always mean a strong economy will pursue. There are momentum-killing factors that we could not have forecasted a year ago, which leaves us to question what the future will hold for us. If you are a tradie or builder, you’d now be considering your risk profile and you’ll be questioning what will happen if your biggest and most reliable contractors are the next to close their doors. You might be left with no work for a long period of time. With interest rates being higher, it is best to be vigilant of your business’ cash flow.
At Diggermate we want to house the capital investment and ride the cashflow risk on equipment for you, so you don’t have to. With the increase of interest rates showing no signs of slowing down, here are some of the reason why right now is a better time to hire than buy equipment for your business.
1. Reduced financial risk
During a softening construction economy, we are uncertain about how strong (or weak) the demand will be for construction services.
By hiring equipment, construction companies can reduce their financial risk by avoiding large capital expenditures on equipment that may not be used as frequently.
2. Better cost control
Hiring construction equipment allows for better cost control as rental rates are typically fixed for the duration of the rental agreement.
This can help construction companies manage their cash flow and avoid unexpected expenses.
3. Improved flexibility
Renting construction equipment provides greater flexibility in terms of equipment type and quantity, enabling companies to adjust their equipment needs according to demand. This can be helpful during an economic downturn, where demand for certain types of construction equipment is volatile and may fluctuate.
4. Access to the latest technology
Hiring equipment allows construction companies to access the latest technology without the expense of purchasing and maintaining it themselves. This can be beneficial during a softening economy when companies may not have the capital to invest in new technology.
Diggermate Mini Excavator Hire not only boasts a wide range of earthmoving machines for hire to use on your own (even without licences!), but it also offers wet hire services with experienced machine operators who are highly skilled and experienced to do your job for you. Diggermate is available in over 75 locations across Australia, so you’re sure to find a Diggermate near you ready to get the job done.
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