When an industry needs equipment to finish the job, they often have two choices. They must buy the equipment they need, or find a temporary solution. Finding temporary solutions are becoming to be a stable choice for many companies. Equipment rental industry reports have shown steady growth over the past several years. Projections for the future are also holding steady.
Why are so many companies turning to rental equipment? There are a few reasons that we have encountered. One of the main reasons is lower costs, lower risk, and decreased responsibility. All of which have provided a distinct advantage for temporary equipment seekers.
The goal of most industries is to cut costs. After all, lower costs mean lower prices for the consumer, or higher profits for the company. It makes sense that companies looking for equipment options would turn to lower cost options. Most often, lower costs are available if projects might be temporary.
When you go on vacation and need a car, you rent one. Since a vacation is a temporary situation, renting is the best option. The same applies to industrial equipment. If a project is temporary, buying equipment is not the best idea.
However, the decision is rarely this easy. A temporary project can often be clouded by the possibility of permanent needs. Take for example a natural gas pipeline in Texas. In June of 2014, oil and gas prices crashed. The fracking industry which was forging ahead at full speed quickly began to pull out from active shale plays. In the fall of 2014, a midstream pipeline contacted Power Zone about a pump station. They were faced with the decision of making it permanent, or seeking a temporary solution.
Either choice seemed like a good idea. If fracking were to resume, they would need a permanent solution. If it were to hold off, the needed boost of flow through the pipeline would no longer be needed. The company decided to go with a rental.
It was a good choice on their part. The pump station was disassembled sooner than they had predicted, only 5 months after installation. Rather than purchasing equipment at the full price, they only paid a fraction of the full cost through the rental.
When the market or a project shows vulnerability, rentals are lower risk. A company isn’t committed to the purchase price of a product if a project happens to be shut down. In the above case of the pipeline, the only commitment was the rental contract.
During disassembly, they were not stuck finding out what to do with the equipment. It was just sent back to Power Zone. Power Zone was even there, helping them disassemble the temporary pump station and clean up the site. With the rental contract they signed, this took place at no additional charge.
Lower risk also ties into lower responsibility. In another rental Power Zone had in fall of 2015, the equipment operators ran into several user errors. Had it been equipment purchased several years ago, they might have been stuck fixing the equipment themselves. As a rental, Power Zone technicians were on-site the same day with replacement parts to get the equipment back up and running.
Since the equipment is owned by the rental company, difficulties encountered with industrial equipment is not your responsibility. Rental contracts require you to follow certain rules and maintenance procedures, but outside that scope, the rental company will take care of it.
Having the owner of the equipment troubleshoot, consult, and repair as needed is particularly appealing to smaller companies. There is no need to hire, or find third party mechanics or equipment operators to keep equipment running. It is taken care of through the rental contract.
These factors become even more important in the realm of competition. Take for example any of the previous examples. By choosing rental equipment, these companies were able to be up and running very quickly. Most of them rented pre-fabricated equipment which enabled them to bypass lead times and waiting lists often encountered with new equipment manufacturers. Rental equipment is often ready to go from the moment a company calls.
Power Zone Equipment has helped companies to gain competitive advantages through their own rental program. With a fleet of various rental equipment, their in-stock packages can be quickly applied to a range of applications. If the right equipment isn’t available pre-packaged, Power Zone offers complete packaging services to provide you with the rental equipment you need for your applications.