Renting Or Buying A Bulldozer: A Look At The Variables

When starting a new construction company, it can be hard to decide to buy or rent a bulldozer. There are many reasons to consider doing either, including the many variables and financial concepts mentioned below.

The Price Differences

When buying a new bulldozer, construction companies can expect to pay anywhere from $30,000 to $200,000 or so. Generally the prices average out to between $75,000 to $175,000, depending on the power of the bulldozer. For those who are just getting involved in the construction business, this can be a difficult amount of money to afford at first.

However, renting a bulldozer will cost around $595 per hour for an 80 horsepower bulldozer. Doing so on a weekly basis will run about $1,540 or so while a monthly rate is typically about $4,600. For those who need a bulldozer right now and who can't afford a costly investment, renting is obviously the way to go.

Insurance Rates Will Likely Hit Hard When Buying

Another problem that occurs when buying a bulldozer is having to pay insurance. While exact rates are typically to gauge because they vary depending on a business' needs, commercial insurance costs usually anywhere from $1,200 (for cars) to about $35,000 (for large buses).

This can be a difficult expense for many commercial construction firms to absorb, particularly early in their life. Again it seems like renting is the best option here as it allows these firms to get a leg-up and get working quickly. It is also a useful way for people who only want a bulldozer for a short period (such as personal landscaping) to get the piece of equipment they need for that time.

Is Buying Cheaper In The Long Run?

Renting construction equipment definitely has its advantages for those who are starting up their firm or who only need one temporarily. However there are some disadvantages to renting. The biggest would be the expenses that could occur if a company needed a bulldozer over an extended period of time. For example, at the nearly $5,000 monthly rate, a project over six months would cost more than the $30,000 for the lowest priced bulldozer.

These rates will also increase if the company uses more than one bulldozer. Using three bulldozers for three months would cost about $45,000 or just half of the cost of purchasing three $30,000 bulldozers. That said, the $30,000 bulldozer is not likely to be as nice as the model rented. The $30,000 model will typically be fairly low in horsepower and lack many of the options that are available on rented models.

As a result, it is tricky to gauge when a company should buy or rent their equipment. While renting can save money over a short period, renting for over a year is likely to cost more than simply buying the bulldozer. Anyone who is serious about their construction company should own their own equipment. Until they can afford it, though renting is the way to go. For more information, visit a website such as http://www.laxequipmentrental.com.