Why Big Construction Firms Prefer to Rent Their Heavy Equipmentby Wave Construction Construction
In the past, the biggest construction firms in the country bought their own heavy equipment. This was a representation of their strength and capabilities as a firm. After the global economic crisis, however, the landscape changed.
The firms began to shrink in size and in population. They all turned to practical and more financially feasible solutions. Every construction firm from that period onwards built the entire industry construction equipment rental in the Philippines.
The national economy has come a long way since the global economic crisis. The construction industry, as a matter of fact, has flourished and is not showing signs of slowing down soon (4.3% growth in 2017, 21.3% growth by the end of 2018).
The government is showing supportive traits by opening up opportunities for firms all around the country. Despite all this good news, firms are still renting instead of investing in their own heavy equipment. Every firm has a reason why and most of them have common reasons. Here are some of them:
The industry is used to renting in general
When the economic crisis hit the Philippines, the conditions were tougher than before but, for firms, it was business as usual.
Competition became harder, but they still needed to eat. As soon as financial situations got tighter than usual, they sought for practical alternatives. That's when heavy equipment rentals started to gain traction.
Don't get it wrong, the equipment rental industry is not new. Firms may have treated equipment rental companies as a back-up plan in the past, but today they are the first, and often the only, choice of firms. Most firms these days are just comprised of a small staff and a lot of contacts and connections. Even small firms prefer to rent their equipment.
The cost and convenience factor
There are a lot of things that can influence the economy. This is a thought that is always in the minds of construction of firms. Renting heavy equipment presents more flexible options that make handling the sways of the economy much easier.
During the planning and proposal stages, the cost and convenience of every part of the project will dictate the practicability of the project. When you have your own machinery, you are responsible for a lot of costs like maintenance and storage. That excludes other costs that you will face as the project progresses.
The vast selection of equipment
Renting heavy equipment is more than just a financial advantage. The fact that the equipment is sourced somewhere else means that engineers can choose the best tools to get the job done.
The implementation of every building phase is more organized. As a result, the project is cleared and completed earlier than expected.
Access to new technology
There's always a better way to build. Contractors believe that in the same way, they can't believe how often that so-called better way is invented.
Technological advancement in the construction industry is moving so fast. Even the most evolved technology in engineering today will be easily replaced as soon as they figure out a better way to do things.
If you buy your own equipment, you're going to get the need to update that technology sooner than you think. If you rent, however, you can choose the best technology every time.
There are still a lot of contemporary companies that invest in their own heavy equipment. Those that don't land a lot of contracts tend to rent out their equipment to other firms. The people in the industry of heavy equipment rental service in the Philippines are often comprised of people that are very familiar with their immediate construction industry in their locality.
At the end of the day, it all boils down to making the best corporate moves. That move may be to rent or to buy your own equipment -- it all depends on the firm and their direction as a company.
Created on Apr 24th 2019 03:47. Viewed 337 times.
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