Outsourcing vs. Buying Equipment for your Landscaping Business
Starting any business requires a substantial amount of capital that could bankrupt you if the business is unable to break even in the allocated time. At times, you may have to make a spousal RRSP withdrawal to pay off your bills or just to survive and especially when you spend too much of your capital on assets.
Naturally, a new business will require basic assets.
- Truck and Utility Trailer
Lawn mowing equipment is heavy and will need a truck to get it to its destination. Relying on rentals at all times may be a bit expensive for our company and so you may one to buy one that you will use for our personal errands as well as the business. The more important thing is to remember how to apportion the expenses when doing your accounting.
Of you have lots of equipment that needs hoisting and holding down in place, a trailer is a good idea as it has restraints that will keep the movable items in place. A new trailer will cost $1,500 and above while side rails and a ramp gate could go for $800 and above.
A mower is our most important equipment as almost every activity in grounds maintenance relies on it. The prices for mowers depend on brand and power among other things. If you have enough capital, buying these would be more beneficial to leasing them but that would also depend on usage.
- Safety Gear and Other Gardening Tools
Leaf blowers, helmets, earmuffs, and work boots are a must have in the industry as you will be working with potentially dangerous plants. The noise goes was about 95bB and so it needs muffling. Most of these items are quite small and reasonably priced and so there would be no need to lease them.
If you are only getting started, then you may not have the capital required to get in the business. The cost could easily add up to over $200,000 but there are companies out there specializing in leasing these equipment.
If you need several mowers per week and for a limited time, it would cost less to lease than to buy them only to store them when you don’t need them. Also, storage cost that most people hardly consider adds up and makes the cost of doing business higher than necessary.
- Access to Quality Equipment
The higher the quality of the equipment, the more it costs and the better job it will do, presumably. Since technology keeps changing, you may prefer to just lease equipment that promises to give you great results as opposed to buy one that gets overtaken by new technology.
- Maintenance is out
Since you don’t own the equipment, you are not mandated to maintain it. Your only responsibility is to ensure that it gets back to the sourcing company in good condition. You will also not need to worry about its security as long as the equipment is not in your premises.
Do your homework
Always do your homework before deciding what works best for you. Both small and large companies benefit from leasing especially with the ever-changing technology.