Landscape and Irrigation is read by decision makers throughout the landscape and irrigation markets — including contractors, landscape architects, professional grounds managers, and irrigation and water mgmt companies and reaches the entire spetrum.
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loading needs and stocking patterns that dictate having a machine on a continual basis. A general landscaping contractor may be clearing and prepping a jobsite one week, installing an irrigation system another week, or planting trees and rolling sod yet another. Although utilization is more varied and somewhat less predictable in some landscaping applications, tracking a machine's usage and demand between multiple jobsites may reveal justification for purchasing to meet longterm needs Attachment versatility The considerations associated with rental or purchase of a machine also extend to attachments. One of the greatest advantages of attachments is their ability to increase utilization of existing capital investments without requiring a large cash commitment. If selected appropriately, attachments can provide more versatility and profitability for the dollar compared to some other equipment acquisitions. In the initial stages of evaluating the attachments that can meet project needs or assist expansion efforts, focus on tools that will provide the best return in the shortest time frame at the least possible cost. If your company has already invested in a skid-steer loader, compact track loader or a compact excavator, then the proper attachment will strategically position your operation to diversify its services. A wellpaired attachment rental for one or all of those machines can improve project control, delay the purchase of a dedicated piece of equipment and — more importantly — provide the versatility to open up new revenue sources. With some manufacturers' attachments, compatibility extends across loader and excavator lines for greater efficiencies, economies of scale and justification to purchase. Some have also been designed to vertically integrate with www.landscapeirrigation.com the machine's electronics and hydraulics. While each type of loader or excavator has its own set of performance benefits in certain conditions, some of today's attachments are interchangeable to provide flexibility and convenience for an equipment fleet that needs to be responsive to multiple jobsites. As your operation has more frequent use of an attachment and schedules are not conducive to getting that attachment transported to your jobsite on a timely basis, or the location is not easy to access, then you may be better off making a purchasing investment. However, it's also smart to evaluate the potential point that an attachment becomes such a significant part of a business that it transitions into the acquisition of a dedicated machine. "A good guideline to follow is if With some manufacturers' attachments, compatibility extends across loader and excavator lines for greater efficiencies, economies of scale and justification to purchase. you are using a specific attachment 50 to 75 percent of the time on an individual loader or excavator, then you may want to consider a dedicated machine.Your loader or excavator will then be available for additional work on the jobsite," said Fitzgerald. Capital resources In the final analysis, determining the right time to rent or to buy is a business decision — one that is based on overall equipment needs, cash flow, cash reserves, the availability of financing tools from manufacturers or conventional lending institutions. Economic forces continue to play a key role in a company's equipment evaluation. Capital is not as easy to secure as it was before the recession. Projects are not as large, nor as plentiful as before when contractors were more risk-tolerant. These conditions have escalated a hybrid approach to equipment that lets contractors test the purchasing waters. Industry experts are seeing a growing interest in rent-to-purchase option agreements (RPOs). This acquisition strategy allows contractors to allocate a portion of a rental fee toward purchasing a machine or attachment, or return it at the end of the rental period. Without question, purchasing a machine carries a greater commitment that typically includes insurance, taxes, licenses, registration, maintenance, operating expenses and transportation fees. Depending on a contractor's financial position, it may be difficult for them to justify this total cost of ownership compared to a flat monthly rental rate for a machine that is delivered to a jobsite. A company's tax implications must also be scrutinized. "Always consult your financial advisor or tax professional to determine if a purchase is a smart decision," said Fitzgerald. "While you can deduct rental payments as a business expense on tax returns, there could be tax incentives for purchases, such as advanced depreciation." As you can see, the decision to buy or rent is entirely dependent upon your company's situation.The most important thing is to take the time necessary to fully evaluate these and any other associated considerations.The pace of business is picking up and changing daily. You might be surprised to learn that what you decide for a project may change before LI the job is done. Debbie McClung is a public relations representative with Two Rivers Marketing, Des Moines, Iowa. Article provided by Bobcat Company, Fargo, N.D. Landscape and Irrigation 23