Leasing vs Buying Industrial Air Compressors
When it comes to factory operations, not every piece of equipment becomes owned by the company. Making lease arrangements sometimes offer cost savings and other benefits that fit better in the company’s budget. For industrial air compressors, the needs of the company should always be taken into consideration before deciding on whether to lease the equipment or to own it outright. Let’s look at some of the reasons to lease equipment and other reasons why you should simply own it for your operations.
Leasing Air Compressors
Lease terms for air compressors will depend on the leasing company. A factory may lease the equipment for a specified length of time, such as for several weeks or several months. Some leasing companies may offer services where the business can return the industrial air compressor earlier than the terms on the contract, allowing the company to save money when the air compressor is no longer in use. Rental companies may also provide delivery and pick up of the air compressors directly at the facility.
Benefits to Leasing Air Compressors
There are many advantages to leasing air compressors. Lease terms are flexible, allowing a company to obtain an air compressor during emergencies or for one time use. Companies also find that the rental costs are much lower than the initial buying costs for the air compressors. They may also find tax-deductible savings by reporting the rental on their tax returns, which can further reduce overall budget costs.
When technology innovations advance, the company can lease the latest equipment at any time. This benefit can provide a competitive advantage to the company without the large investment.
When to Lease Air Compressors
A company may decide to lease an industrial air compressor if they have a special project that only requires one for limited use. They may also rent one during seasonal work upticks or if they experience an emergency shutdown of onsite air compressors as they need to lease one as a backup until systems get back online.
Another time when a company may lease an air compressor is when first opening operations and still are acquiring equipment. Leasing the air compressor allows them to try it out now and then later decide if they want to make a permanent purchase. Some lease companies allow customers to take out a loan on the equipment and place previous lease payments toward the loan.
Buying Industrial Compressors
Purchasing industrial compresses allows a company to expand their operations to continuously remain competitive in their industries. Air compressor companies customize and tailor the air compressor to operations as it may be standalone equipment in the production process or part of a larger system. Due to this customization, the company can create more efficiencies to increase sustainability and cost savings.
Benefits to Purchasing Compressors
Purchasing an air compressor outright allows a company to build equity in the equipment immediately. This cannot be done when leasing equipment as the rental company owns the equipment.
The company also has complete control of when to use the equipment. They don’t have to schedule all the air compressor work during the time when the lease agreement begins and rush to get it completed before the lease ends.
When to Purchase Air Compressors
It’s ideal to purchase industrial air compressors when planning to use it for an extended time and heavily on a daily basis. Another reason to purchase equipment is when capacity requirements are higher than what is normally found in rental units. In these circumstances, an air compressor company can customize the equipment so it can work more efficiently with current processes.
While upgrading to the latest technology is easier when leasing, a company may be able to sell off the old compressor and recoup some of the initial purchase costs. Then they can place the capital into purchasing an updated unit.
Obtaining an Industrial Air Compressor for Operations
There are many options when obtaining industrial compressors. Whether deciding to lease or purchase this equipment, it is important to evaluate several key factors. A company needs to decide if the types of projects would benefit from a purchase or lease option. A company should also think about the future use of the compressor if they only use it for special projects.
Want to talk through you options with a compressed air expert? Contact JHFoster today.