Why rent formwork? 7 reasons why renting can be the winning formula
Rent or buy? How many times have you asked yourself this question when you need equipment, especially if it is worth a lot of money?
How many times have you found yourself having to weigh up the pros and cons of both options?
Renting involves paying a fixed monthly cost and requires less available cash, but ultimately, you do not own the asset. Buying, on the other hand, requires having available capital and then managing the asset (maintenance, transportation, etc.).
We live in a world of ever-increasing availability and choice, where the sharing economy is making it more possible to share assets by renting them. Such assets include bicycles, electric scooters, cars, and office equipment (PCs, printers, etc.). There are also platforms where you can rent clothes, private property, and many other products from all sectors.
In other words, we live in a world where owning assets is less and less important, where value is more about being able to use the right product, at the right time, and only for the time that you need it.
Given this trend, the rental of formwork is also becoming increasingly common.
Why? Because it is convenient. Let’s take a look at the reasons.
1. THE RIGHT MATERIAL FOR THE REQUIRED PERIOD OF TIME
Renting means having the right amount for the job, for the required length of time. In the formwork sector, this can make all the difference, especially when working on special projects where the structure requires a formwork study, such as for a tailor-made solution. Such formwork is unlikely to be needed for other projects, either because of its distinctive features or because of the large amount of material.
In this case, it would be somewhat inconvenient to invest large amounts of money in formwork equipment which may only be used for a single job or for solutions that are not very repetitive.
The time factor is another fundamental factor. For example, creating a circular tank may involve using large amounts of formwork for a short period of time. This means that investing in material would make financial sense for the company.
Having the right formwork equipment just for the required time could be absolutely the right solution in order to avoid large investments in equipment when there are doubts about future returns.
2. LESS FINANCIAL COMMITMENT
Renting makes it easier to balance your cash flow. The costs are much lower and more controlled compared to buying, where there are always limitations on payment terms or discounts and you need significant liquidity. At a time in history when liquidity in the construction sector is a problem, being able to control it is a great advantage.
To better manage expenses and rental fees, it is essential to have tight control of the equipment on site, avoiding larger formwork orders than necessary, and above all, trying to respect the time allocated at the beginning of the rental. This will make it possible to achieve even greater profitability by optimizing the productivity of rented equipment.
3. LOWER WAREHOUSE OCCUPANCY
Buying materials also involves management costs. In the case of formwork, buying means considering storage, handling, and transportation costs, which can, in many cases, be very significant.
In fact, formwork can be heavy and occupy a lot of space, which is not easy to address without enough trailers or the right means of transport.
Maintenance also requires dedicated, competent people who know how to handle the formwork properly, repair it, and change the necessary components when they deteriorate.
Investing in formwork is often assessed while underestimating all the management costs, and a correct assessment of rental/purchase options should weigh up all these costs in the best possible way:
- Warehouse rental/investment
- Timber yard staff
- Replacement components/accessories
- Etc., etc.
4. COMPREHENSIVE TECHNICAL SERVICE
Having a formwork technician to assist you in the different phases of the work is not something to be overlooked. Especially for jobs of a certain difficulty or size, on-site technical assistance can make a difference for several different reasons.
First of all, they can be important in the design phase, helping to identify the most suitable, productive, and economical formwork solutions for the work.
Secondly, they can help resolve on-site problems of various types: project changes, unexpected events, delays with respect to phase scheduling, changes in deliveries, etc.
Finally, technical support can be very important in all non-conventional formwork assembly phases, where having a dedicated technician to explain the assembly can reduce assembly times and thus improve on-site productivity.
5. BUILT-IN SAFETY
On-site safety is too important to be ignored. It often requires studying ad hoc solutions. For this reason, renting makes it possible to incorporate the best safety solutions into the project, which is not always feasible with the equipment or material available in the company’s warehouse.
With respect to formwork systems, the design provides protection systems, guardrails, ladders and everything necessary to guarantee safety in the different phases of work.
6. AVAILABILITY OF MATERIALS
Managing more than one site at the same time means multiplying productive resources, and it is often difficult to optimize them. And above all, the formwork equipment needed is not always available when working on more than one job at a time, especially when the market is growing or at busy or peak times.
In these situations, there is the risk of investing a lot of money in buying formwork and yet still not having enough material for other work to begin. On the financial level, past investments will be added to the rent required for new works, creating a high risk of a lack of liquidity.
Assessing a rental strategy for all sites could increase available liquidity, guaranteeing the necessary and appropriate equipment for each site. Above all, it would allow savings in those logistical processes that can become very complicated when work volumes are high.
7. POSSIBLE TAX CONSIDERATIONS
A final advantage of renting is the ability to offset the costs in the respective fiscal year. In fact, being a direct cost, it will reduce profits for that respective year, and there will be no need for amortization over several years as in the case of investments.
Investments in buying equipment is a large cost and the tax benefits are spread over the years following the investment, while renting is a directly deductible cost.