I hear of customers who need equipment but simply don't have the budget or
resources to take on the purchase of a new lift. Recently I ran across an article at
Fleetman Consulting that addressed this issue. It wasn't too long and addressed all the high points. I'd like to share that with you here.
Call us today, we'd love the chance to discuss rentals at your location.
Historically, renting forklifts has
always been considered something you did short term, ie by the day, week or
month.
Over the past number of years
renting has been gaining in popularity as a viable alternative to buying or
leasing longer term, ie 12, 24, 36, 48, 60 or 72 months.
Here's why.
Advantages
of Renting Forklifts Long Term, ie Beyond 12 Months
- One monthly payment includes truck, interest and
negotiated maintenance costs
- Budgeting is much easier and accurate with one monthly
payment
- Lines of credit or cash remain available for more
important business costs, ie inventory
- Maintenance costs are now controlled and not subject to
increases or overcharging
by the dealer - Supervisory time spent deciding on which repairs to
authorize and issuing purchase
orders is significantly reduced - Supervisory time spent making sure planned maintenance
and other repairs are
completed on time is reduced - Supervisory time spent approving repair invoices and
running reports on forklift costs
is significantly reduced - Supervisory time spent justifying repair costs and
tracking maintenance costs
per forklift is eliminated - Clerical time spent issuing cheques and filing invoices
is significantly reduced
- Upgrading is decided in advance which eliminates
exposure to costly major component repairs
- Dealer is now responsible for completing repairs on
time and in accordance with the
manufacturer's guidelines - The cost of parts, the labour cost per hour or travel
time costs from the dealer are no longer relevant
- The cost of shop supplies, environmental levy's or fuel
surcharges may no longer be relevant
- Much easier to "trade up" into a different truck if
business conditions change or if the truck is
no longer suitable - Forklift fleet stays up to date with the latest in cost
efficiency, productivity and safety enhancements
- Customer employed resident forklift technicians can now
focus on production equipment and facility
maintenance - Productivity gains should be realized from a more
efficient, up to date, well maintained fleet of forklift trucks
- Liability exposure with your insurance company will be
reduced
- Exposure with WorksafeBC will be reduced
- Downtime costs may be reduced if properly negotiated
with the dealer at the start of the rental period
- Financial return on assets ratio will be improved
because the forklift asset is removed from the balance sheet
Applications
Where Renting Long Term Makes Sense
High hour usage, ie 1500 hours per year or more ( possibly less depending
on the circumstances )
Abusive applications, ie Fish processing, stevedoring, mining, foundry, tannery,
chemical / fertilizer plants etc.
New business or new application
start up, ie Limited credit, not sure what
truck is suitable over the longer term
Employee challenges, ie expertise and time to control and track maintenance and
other forklift costs are limited.
representatives or CSRs. The sheet lists a summary of sales for their
assigned territory, and on a subsequent set of pages individual sales
numbers for each of the accounts within their territories. They use this
of course to target accounts trending down with some attention, and to
understand and define which customers they need to stay even closer to
do the volume of business done by them [A accounts lets say]. More importantly, we can also identify spikes and work with customers to understand the causes and propose solutions.
point in the future. A real responsibility is insuring we don't have the part in stock.
