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Equipment Issue: Rent or Buy?
Most maintenance and engineering departments rent equipment to complete some tasks, such as those involving lighting, exterior maintenance, or grounds care. Before doing so, however, managers must consider the length of time and number of times workers need the equipment, the budget, storage capacity and equipment maintenance. To determine whether renting a piece of equipment or buying it is the best option, managers can develop a strategy that weighs those issues.
It can be difficult for managers to justify the cost of buying equipment designed for a specific task if the department does not regularly perform that task. In these cases, renting might be a more sensible option.
“We tend to rent specialty equipment,” says Vincent Curl, facilities supervisor for Prince George Schools in Upper Marlboro, Md. For example, to maintain the interior courtyards of some buildings, his department occasionally rents a front-end loader that fits through the building’s double doors.
While having this equipment allows his department to complete particular tasks efficiently, it doesn’t perform these tasks often enough to justify the cost of purchasing one. If departments rent the same piece equipment frequently, however, managers need to consider the advantages of equipment ownership.
“When we find ourselves repeating the rental several times, we start to look at the convenience and improved response times of having our own equipment,” says J.D. Thompson, director of maintenance and special projects at Hendrix College in Conway, Ark.
Renting can be more cost effective if a department can coordinate the rental with other departments in the organization.
“We let each other know before we rent something so everyone can think over their needs and make the best use of it,” Thompson says. “For example, we rent a lift for changing out light bulbs on the sides of buildings, but we share it with the grounds department, which uses it to trim hanging limbs or removing leaves from gutters.
“We sometimes rent a backhoe for a special project and virtually anyone who needs a hole dug — including grounds, exterior lighting and even contractors — jumps on board. We have shared our scaffolding with the art department for doing theater backgrounds and changing lighting and with the housekeepers for cleaning windows.”
Equipment on Short Notice
Managers also find themselves looking into equipment rental options to keep buildings operational during scheduled equipment shutdowns or in the aftermath of floods and power outages. During these situations, renting can be a quick solution to existing equipment problems.
Curl says his department has rented electric generators when the buildings lose power due to storm damage.
“When we have a big storm, some schools might not get power for up to five days,” he says. “That is unacceptable to us. We’ll rent a generator to bring the building back online.”
Demand for essential pieces of equipment, such as generators, increases significantly when power outages and similar emergencies affect large areas. In these cases, it is particularly important that managers call rental companies in advance to ensure the equipment they will need is available, Curl says.
Managers should secure the rental agreement as soon as they identify the need for such equipment. Not doing so could cause further delays in restoring building operations.
Many rental companies offer brand-name equipment featuring the latest technology advances. Before deciding whether to invest in purchasing, managers might want to rent the equipment to allow their technicians to evaluate its performance.
“We have done that with lifts,” Curl says. “We’ve rented the lift, liked it and then bought our own.”
When selecting an equipment rental company, managers should investigate several issues, including the company’s location, price and ability to provide the required equipment.
“Location is important when delivery fees are substantial or prohibitive, like for a jackhammer,” Thompson says. Managers also need to consider how well a rental company maintains its equipment.
“The condition of the equipment make a difference of where we rent,” says Bill Eaton, director of maintenance for Alvord Unified School District in Riverside, Cal. “If it’s not good, we’ll go somewhere else. I don’t want to spend more time fiddling with the equipment than running it.”
While customer service might not be the biggest priority for managers when selecting a rental company, it can become a major concern should the piece of equipment fail.
“If the company is quick to respond to broken equipment or gives us a better piece of equipment than we paid for when the one we rented goes down, that is a good bit of customer service that we remember,” Eaton says.
Adds Curl, “You might get a piece of equipment that doesn’t perform or breaks down on you. That goes with the territory. But for the most part, we’ve been pretty happy. If something goes out on you unexpectedly, they’ll replace it. You just take it back and they’ll give you a new one.”
Steps for Success
Before signing a rental agreement, as well as during and after using the equipment, managers should take several steps to ensure a successful experience.
First, managers should keep in mind the legal aspects of the agreement, says Thomas A. Westerkamp, a maintenance management consultant and contributing editor to Maintenance Solutions. These aspects include the price and terms of payment, as well as liabilities.
“They should be aware of who is liable if the user damages the equipment or the property during use,” Westerkamp says. “Also, what happens if someone gets injured when they’re using the equipment or because of the equipment?” Managers also should pay close attention to the equipment’ physical features.
Managers also might want to ask the rental company for advice on equipment applicability. Different equipment brands often have different features.
“If our department’s head electrician is renting a piece of equipment, the rental company and electrician might discuss what piece of equipment is appropriate, what its strengths are, and how long it will run between refuelings,” Curl says.
Before picking up rental equipment, users also need to carefully inspect it for problems.
“Make sure you document the condition it is in before you pick it up, and make sure it runs before you go out of the yard,” Curl says.
Adds Westerkamp, “It is important to get a statement from the rental company that the equipment is in good condition and compliant with all current regulations.” The company also should provide an operation and maintenance manual and an inspection checklist.
“Check that all parts and accessories come with the machine, and ask if there are other parts or accessories available for it,” Thompson says. Managers should make sure they have associated safety equipment, such as harnesses, shields, goggles and hard hats. The rental company should go over the procedures of starting and using the equipment, even if managers believe their technicians have the knowledge and skills to operate it.
While renters need to make certain that equipment safety features work, the best safety measure is having a well-trained operator, Westerkamp says. Managers should keep this in mind when determining who will operate the equipment and designating one person to identify safety problems and ensure daily checks are done with due diligence.
For some equipment, such as large truck cranes, managers might want to ask if the rental company can provide an experienced operator at an hourly rate, Westerkamp says. Managers also can consider hiring an operator helper through the rental company. This person would maintain the equipment, clean it and help with hook ups on the ground while the crane is on the job site.
Besides ensuring workers follow safety procedures, managers also need to ensure that the equipment is not vandalized or stolen.
“Don’t leave the keys where they can be found,” Thompson says. “Kids usually know that the keys for construction equipment often are stashed somewhere on the equipment.”
While heavy machinery might be difficult to steal, this equipment often comes with toolboxes and removable parts that are easier to transport off the site. At the beginning and end of each workday, equipment users should account for every tool and accessory that came with the rental machinery.
Finally, managers should document the condition of the equipment when returning it to the rental company after use.
“Don’t leave it in such bad condition that they won’t like to rent to you again,” Thompson says. Rental companies might not offer new equipment to customers they believe are likely to damage or abuse it.
To determine whether renting or purchasing equipment is the best strategy, managers should look at issues, including budget considerations, the length of time the workers need the equipment, and the technology that will help workers complete the job effectively.
The following organizations can provide managers with information and advice regarding equipment rentals: