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Cost effective: Rent or Own?

Discussion in 'Commercial Snow Removal' started by 89Comanche, Feb 8, 2011.

  1. 89Comanche

    89Comanche Member
    Messages: 42

    As you may have seen in my out of the industry thread, I am attempting to re-work my business into a more profitable venture. Right now we are running an older Case 1845C,we got it used from a older gentleman who said he "only used it around the house" but it would appear in a past life this little girl was beaten to hell, the poor machine is at her breaking point from years of dedicated service. Annually we end up spending a good portion of $$$ in her upkeep. We use her at a smaller lot about 300x500ft, currently runs a 9ft straight blade. We are weighing our options for next season, buy a new machine or rent one for the season.
    So for those who own machines and those who rent them for the winter months what is more cost effective? This has become a hot topic over here any help would be appreciated.

    Facts to know
    *Lot is almost always full with cars
    *Machine will stay on site entire season
    *Owned machine will run straight blade/Rented machine will run the Kage system
    *As always time is money

  2. hydro_37

    hydro_37 PlowSite Veteran
    from iowa
    Messages: 3,790

    I would buy as you can write off repairs and the machine itself
  3. rcr4w

    rcr4w Member
    Messages: 39

    I just worked out a deal with my local case dealer "Rex Spencer equipment" for next year. They will supply us up to 4 loaders during snow storms and only charge us for the hours they are used"hour meter" our deal breaks down my daily rate into a per hour cost $215 per day / 12 hours basicly $18 per hour used for new case or Takeuchi cab with heat loaders. Now I rent and buy alot of equipment with them but they were very willing to work out a deal this keeps me in new loaders pretty cheap I only wish I had thought about this back in november. So I would suggest trying to work out a similar deal with a local dealer.
    Last edited: Feb 8, 2011
  4. rcr4w

    rcr4w Member
    Messages: 39

    Leasing is the only way to go you can write off every lease payment as well as any repairs plus if you like case they have a great deal going on leasing
  5. s. donato

    s. donato Senior Member
    Messages: 314

    my family rents and owns. we own two machines(back hoe and skid), but then rent when we need to.

    usually its cost effective to rent one when we only need it to do push backs, clean ups, removals from sites. we don't rent for the whole season. again we have a deal worked out with a local rental yard. if something breaks we make a phone call. also we schedule delivery and pick up, so we aren't tying up a truck to pull the trailers and unload elsewhere. also we have a bunch of operators, so we can run multiple machines at a few jobs at the same time instead of one crew running from one place to the other. in the big storms this really keeps people happy.
  6. ironsales

    ironsales Junior Member
    Messages: 28


    I sell and rent equipment full time. To determine if you need to rent or own, you need to take a look at your equipment needs. If you only need a skid steer during the snow season then it would be best to rent. This way you can rent exactly what you need for the jobs you are bidding on. If the skid steer is going to be utilized year round and the skid you are looking at is the size you need all year then purchasing a unit would be the way to go. For a seasonal snow rental it would normally be 80 hours per month and approximately 50 to 60 percent of the normal rental rate. With renting, the dealer is resposnible for the maintenence and any issues on the machine during the rental. If you own it you are 100% responsible. Matt if you have any questions feel free to pm me.

    Rcr4w you got a hell of a deal on your rental! This year loaders and skids are the golden commodity and are not available for rent in the the North East.
  7. Omran

    Omran Senior Member
    from KY
    Messages: 265

    I own a skidsteer since 2003, but if I was in your area where snow is all the time I will rent one for the winter and don't worry about it. you can write off all the rent and you can stay out of the repair shop.
  8. BlackIrish

    BlackIrish Senior Member
    Messages: 888

    Lease to own for 5 years with a $1 residual.
    If you always rent you won't be building any equity. :nono:
    Up here winter rentals on loaders cost almost the same as a years worth of monthly payments. Rent for 5 months or own for 12 same money.
  9. rcr4w

    rcr4w Member
    Messages: 39

    Yes I got a great deal from them but we don't have snow here in missouri like you guys do so winter is a BIG slowdown for them they were extatic about the deal for them its all about some cash flow plus they know we take care of our equipment wether its stuff I own or rent from them.
    They have 6-10 loaders in their rental fleet here in town and haven't rented any of the out yet this year with exception to the weekend warrior and havent sold but 1 new loader this year equipment around here just isn't moving at all.