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Renting And Leasing; Excellent Options In The Right Situations

When is it better to rent or lease rather than to buy? Many fleets find that all three options are appropriate in different situations. For example, some fleets rent some trucks and lease others. The National Private Truck Council suggests that about 60 percent of fleets primarily purchase their vehicles, while 40 percent rely more on leasing.

Renting

In general, very short-term needs are better met by renting. However, leases are typically better for any need that spans more than a couple of months. Also, seasonal needs are often met by simply entering into rental agreements. Rentals are also appropriate when a large job temporarily outstrips your fleet assets. Unanticipated events like accidents or major maintenance needs may also be addressed by simply renting equipment for days or weeks.

Leasing

For some time, leasing has been popular because it greatly reduces or eliminates the traditional capital investment in truck assets. Rather than entering into an agreement to pay the full cost of the equipment, you simply pay for the use of  the vehicle for a set period of time and/or a given number of miles. Since a large loan is not required, you keep more of your credit lines available for other uses.

Also, when available credit is thin, leasing is often the way to go. When you lease, you merely carry the lease payment on your books as a monthly expense, just like fuel, maintenance costs, etc. There is no need to calculate depreciation.

Nimble and Responsive

Leasing can make your business more nimble - more able to readily respond to new business opportunities. Dynamic, growing companies may also prefer leasing to free up cash to invest in personnel, maintenance facilities or other infrastructure. As new technology comes along at an ever-faster pace, those wanting to take advantage of the latest in safety systems or connectivity will want to take a close look at a relatively short-term lease. Again, those that lease are often more able to respond to changing market conditions and/or new cost-saving technologies. 

At Robertson Truck Sales, we’d welcome the opportunity to help you make an informed decision on renting or leasing your next truck, trailer or other equipment important to your success.


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