As you start a manufacturing business or while trying to scale an existing one, you might be bothered with the question of whether you should invest in purchasing your own equipment or be content with leasing. Believe it or not, there are some circumstances where leasing is actually the better option, no matter how counter-intuitive it might feel to spend good money to use something that will never be yours to keep.
In this article, we’ll explore some of the most important factors to consider when deciding whether to buy or lease the equipment you need for your manufacturing business.
For machines and equipment that are absolutely essential in your business operations, it definitely makes more financial sense to buy your own. Still, the most controlling factor is of course, how much money you have in your budget for the procurement of equipment. If it’s not sufficient to buy all the equipment you need, then you, of course, have no other choice but to lease equipment for now.
If your budget can’t cover everything you need to buy to keep your business running, then prepare a priority list and identify which equipment is absolutely crucial for your business and which ones are only useful every now and then, and can therefore be leased just when you need it.
Maintenance and storage costs
The beauty of leasing equipment is that you won’t be responsible for any storage or maintenance requirements, except during such time that the machines are in your possession. If you have the space and the budget to allot for your own equipment, then by all means go for the longer-term investment of purchasing.
If you have neither the storage room nor the extra budget for maintenance, then leasing makes more sense.
Your manufacturing needs
As mentioned earlier, there are some machines that your business just cannot survive without. In the long run, you would be wasting a lot of money in leasing these equipment pieces for years when you can have one of your own for a fraction of the cost. For example, if your industrial operations constantly deal with bonding, injection molding, potting, or printing, then there’s no doubt that you will benefit from having your own atmospheric plasma treatment system.
Such a device is suitable for fine-cleaning and activating surfaces, thus, making them easier to bond together or paint on. If you know this is a process you’d be doing day in and day out, it definitely makes more sense to buy the device at https://www.bdtronic.com/plasma/plasma-methods/atmospheric-pressure-plasma/ to procure a unit for yourself, rather than going through the trouble of leasing the device year in and year out. So make sure you know how frequently you’d be using a piece of equipment before you decide whether to rent or buy one.
For any kind of equipment, what you want to do is calculate the costs of leasing versus the purchase price of the unit. Then you can find out which option makes the most financial sense while still fulfilling your production targets.
While hiring a facility manager remains to be optional for most companies, having your own fleet of devices, machines, and equipment to look after might actually require you to have a manager to oversee not just their operation, but also their maintenance and any possible repair needs.
Keep in mind that even when you invest in automated machines, you would still need individuals to manage such equipment, even just to make sure that they’re running at full efficiency and to determine whether there’s a need to repair or replace some parts that might become faulty as time goes by.
The debate between leasing and buying equipment has been around practically since manufacturing became a democratized business. In the end, you will have to find out for yourself which one suits your needs at any given time. Just remember the considerations outlined in this article and you will surely come up with an informed decision that will prove to be best for the interests of your business.