For many small to medium-sized construction companies, it makes more sense to rent some types of heavy equipment when it’s needed rather than purchasing the equipment outright. A growing trend in American commerce, that of the “sharing economy,” has the potential to significantly change heavy equipment leasing and the way construction companies acquire and use the equipment they need.
Leasing companies and rental agencies have been the traditional solution to the challenge of finding and acquiring the right equipment when it’s needed. As commercial entities, these businesses must operate on a model that allows them to generate a profit on the items they lease. Even if leasing costs are relatively high, construction companies can still benefit financially from short-term leases instead of high-dollar purchases.
The concept of the sharing economy, however, has the potential to disrupt the traditional supply chain used in equipment rental and leasing.
The sharing economy approach allows almost anyone who owns a valuable commodity to make that commodity available to others for a price. For example, companies have emerged that allow private individuals to make their personal vehicles available for transportation, bypassing traditional taxies. Others offer temporary lodging in individuals’ homes, eliminating the need for a hotel room. Often these services are less expensive than comparable services from commercial companies, and are easier to acquire through specialized software and online connections.
For construction companies, this may lead to leasing equipment from other builders rather than from a specialized agency. Construction firms with heavy equipment sitting idle can generate revenue while smaller companies can find necessary equipment at a lower price. Services that match equipment owners with companies that need that equipment have already started to emerge, according to reporter James R. Hagerty in the Economist.
Industry professionals turn to Construction Monitor for the latest news on important trends that will affect how business will get done and projects will be completed. Contact us today for more information on heavy equipment leasing and how the concepts of the sharing economy are likely to transform how companies purchase, lease, and use the equipment they need.