Capital & Operations
Buy, rent, or lease: three structures, three fits.
The right answer depends on utilization, lifespan, and how much cash you can afford to tie up.
The three options
When each one wins.
- 01
Buy outright
Best when utilization is 70%+ and the equipment lasts 8+ years. Chippers, dump trucks, climbing gear. Total cost = purchase + maintenance + insurance + fuel, minus resale value.
- 02
Lease
Best when equipment depreciates fast or technology shifts. Newer trucks, GPS-tracked vehicles. Total cost = monthly × term + buyout + maintenance + insurance + fuel. Usually 15 to 25% more than buying over the same period, with no large cash outlay.
- 03
Rent
Best when utilization is under 30%, the job is one-off, or you’re testing a category before buying. $400 to $1,200/day for trades gear. Sounds expensive until you compare against a $25k stump grinder you’d use 8 days a year.
Decision table
Real gear, real answers.
- 01
Chipper, 4 days/week, 50 weeks: BUY
Utilization 80%+, payback under 3 years. Owning beats every other option.
- 02
Bucket truck, 3 days/week: BUY or LEASE
Depends on cash on hand. Lease if you want to preserve working capital, buy if you have it.
- 03
60-ft lift, used 2x/year for big takedowns: RENT
Not enough use to justify the carry cost. Rent it, charge it back in the bid.
- 04
Stump grinder, used weekly: BUY
Assuming storage and trailering work. Weekly use clears the utilization bar fast.
The decision frame
Bring every option to cost per productive hour.
Total cost over the period ÷ productive hours of use. Compute it for buy, lease, and rent on the same piece of gear. The cheapest number usually wins.
A $68k chipper that runs 1,600 hours/year for 8 years costs around $7/hour all-in. The same machine rented at $800/day for the same 1,600 hours costs $80/hour. The decision is rarely close once you do the math.
The bottom line
Utilization is the whole game.
High use, buy it. Medium use, lease it. Low use, rent it. Skip the math at your own cost.