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Forklift Rental Purchase Option – Is It To Your Advantage?

November 21, 2011

If you have a long-term need, but are not ready to commit to purchasing forklift equipment, a Rental Purchase Option (RPO) is a solution for your company. A Rental Purchase Option allows your company to put portions of your monthly rental payment toward the purchase of the equipment, but doesn’t commit you to the acquisition.

When a RPO Is Your Better Option

Try it before you buy it
When you have uncertainty about the forklift handling your application, a RPO gives your operators an opportunity to use the unit while handling your product. This is especially advantageous when the materials and loads vary.

If your company has plans to update the forklift fleet and is considering a new equipment manufacturer, a RPO gives the operators hands-on experience with the lift. In addition to gaining a comfort level with the forklift, operators can provide feedback on the operation of the unit.

Money isn’t currently budgeted
Because forklift equipment is a large investment, oftentimes companies budget for the expense. If you need equipment before budget funds are secured, a RPO helps to get the unit to your facility prior to the sometimes lengthy approval process. Rental rates can be paid on a monthly basis and the term can be as short as 30 days.

Having the forklift as a RPO also helps the budget in regards to maintenance. While your company is paying the monthly rental rate, basic maintenance and breakdown repairs are handled by the vendor.

Spike in business
If your company experiences increased business, you may doubt the production level will continue long-term. However, if the short-term forklift need turns permanent, a RPO can significantly reduce the acquisition cost by applying a portion of the rent toward the forklift that has proven itself in your application.

Want to learn more about placing a forklift on a Rental Purchase Option (RPO)? Contact ProLift for more information.

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Four Ways To Keep A Forklift Purchase In Your Budget

June 15, 2011

The purchase of a forklift is a major investment for any company. Depending on options and fuel type, new lifts may range from $18,000 – $28,000. With the pressure of the economy and the need to increase the company’s bottom line, replacing or adding to your current forklift fleet may seem impossible. However, four common options can offer a solution.

Lease & Finance Options

There are many products through lending institutions that offer custom designed lease products for your individual business needs. Some of these options include:

Skipping a lease payment, which is beneficial for seasonal business when revenue is not generated monthly.
Two term leases, which gives the ability to walk away at the end of the first period or significantly reduce the payment during the second term.
Accelerated or decelerated payments, which is a fixed term with payments increasing or decreasing over the term. This option can help decrease your interest expense or reduce your current payment until business improves.

Buy Used

If your equipment runs less than 4 hours each day, buying used may work for your application. Many used trucks arrive in the fleet when they are turned in for trade or off-lease. In addition to the initial cost savings, most units have been reconditioned by the dealer. Upgrades may include paint, tires and safety features. Warranties are often included or available for upgrade.

Consider an Electric Pallet Truck

The electric pallet truck (EPT) is often overlooked, but will save thousands of dollars on the purchase. For applications requiring only a horizontal movement of product, you should consider an EPT.

Rental or Rental Purchase Option (RPO)

If you have a forklift need but do not have the money in the capital budget, try renting. Companies will consider discounting rental rates for long-term commitments depending on the application and usage.

A twist on renting equipment is a rental purchase option (RPO). Just as the name suggests, a new or used truck can be rented for a predetermined period and you have the option to purchase that truck while applying a portion of the rental payments. The key to RPOs is determining your long-term needs and the decision to own the truck.

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When to Rent Lift Equipment Versus a Purchase

December 6, 2010

When production at your company begins to gradually increase or a short-term project is announced, whether or not to invest in lift equipment is a key question. Use these questions to determine if you should rent lift equipment versus a purchase.

Has the increase of business been caused by a particular event?
Almost every company has been touched by the economy and experienced a decrease in operation, so it is exciting to have an increase of business. However, it is important to research the reason for this increase and understand why it is happening. If you cannot determine with certainty the increase is permanent, renting lift equipment is your better option. Renting lifts allows a short-term commitment, obligating your company to only a monthly, weekly or daily expense. Use a rental to maintain peak levels of productivity to ensure your customer orders are met.

What is the length of the short-term project?
Short-term projects may be internal or brought on by a customer request. It is important to determine the length of the project and obstacles that can lengthen or shorten it. If your project is planned to be 6 months or longer, you may find a benefit to purchasing a lift. Dollars used for the monthly rental can be invested into a purchase of a new or pre-owned lift.

Do you need a specialty lift?
While some companies have a need for a mixed fleet, your equipment may be standard for your operation. If a specialty lift is needed for a project, rental allows flexibility to have access to equipment you would not normally purchase. Only consider a lift purchase if the equipment can be used with long-term, daily operations.

Did your company set aside budget dollars for a lift purchase?
Most of us are being cautious about budgeting and setting aside dollars only for immediate needs. If business has been unpredictable, more than likely your company did not set aside budget dollars for a purchase. Keeping rental as your option decreases the risk of not having the cash flow you need for other projects or emergencies.

Are you concerned the need for equipment will become long-term?
If the increase to your business appears to be stable and long-term, paying for a rental may seem like a waste of money. In this case, select a Rental Purchase Option (RPO) for a new or pre-owned lift. The RPO allows you to put a portion of your monthly rental payment toward the purchase of the selected lift, but doesn’t commit you to the acquisition.

Want to learn more? Click on these links to learn how ProLift can help you with rental equipment or a Rental Purchase Option (RPO).

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Forklift Rental Purchase Option – Is It To Your Advantage?

Four Ways To Keep A Forklift Purchase In Your Budget

When to Rent Lift Equipment Versus a Purchase