There are benefits to both the leasing and purchasing of vehicle fleets, but optimizing those benefits depends on your company’s needs. Requiring a pickup rental fleet of 20 for a short-term project is much different than needing to purchase 500 regular sized cars for the lifespan of the cars, and each should be treated as such.
When You Should Rent
These are some of the circumstances that should lead a company to renting instead of buying a fleet:
- If your business is (or might be soon) in need of immediate cash flow availability, renting is a better strategy. Requiring a much smaller initial investment, leasing affords your company with a higher amount of cash on hand to be dedicated elsewhere.
- If you are only needing rental trucks or other vehicles for a fixed and short amount of time. Short would be anywhere between a month and a couple years.
- If you cannot afford to dedicate an employee to manage the administrative tasks necessary in maintaining vehicles. Since lease providers typically offer packages for responsibility over issues such as taxes, license renewals, record-keeping, etc. this allows attention to be focused on the operations of the fleet instead.
- Other expense aids are often available such as management tools that monitor expenses and controlled fuel spending tools. These packages can reduce costs by freeing up time that would otherwise be spent on those responsibilities.
When You Should Buy
These are circumstances that might lead your company to purchasing the fleet instead of renting:
- If you have the means to do so, purchasing outright or taking out a loan on a rental trucks might be a good idea for you. The main benefit of leasing is reducing the financial risk associated with purchasing, but owning a fleet is an extremely valuable asset.
- If your company would like to have complete control over your fleet, purchasing is the best way to attain that freedom.
- Another benefit of owning vehicles is the potential of gaining a return on your investment through resale. Although the fleet’s value decreases quickly, you can get some capital back if you decide to sell.
