What is the difference between Renting or Leasing Industrial Rental Equipment?
There are, though, many differences between leasing and renting. A lease, for instance, is a contract to rent an asset, be it land, a building, or machinery, for a set period of time, typically long term, at least for a year or more and for set payment terms. Leases, also, often come with many conditions in terms of the allowed use of the assets and even required maintenance terms to be acknowledged by both parties.
Renting, typically involves a shorter time period, often 1 year maximum, with the option to extend after the term at the discretion of both parties. Rental agreements are more suitable for the temporary use of assets (land, buildings, or machinery) when the expectation is that it will not be needed long term. This is especially useful for projects related to construction where an expensive piece of equipment such as a crane is only needed for a relatively short amount of time and therefore is better suited to a short-term rental contract. Rental contracts, as a result, are generally far more casual than lease agreements, where, as mentioned, a formal agreement with many terms will be drawn up.
By renting, companies can reduce costs associated with operation, transportation, and servicing requirements and therefore gain a significant advantage when operating with budgetary constraints. The global construction industry is expected to observe enormous growth in the near future thanks to additional developments such as enhanced maintenance services offered by rental companies and an ever-growing demand across emerging economies.
There are incredible opportunities for all along both ends of the supply and demand chains across these markets in infrastructure, residential, and non-residential sectors with no end in sight. This is a result of the increasing construction of multi-family houses, and increased investments in the construction of roads, highways, smart cities, metros, bridges, and expressways to parallel the ever-growing population and urbanization worldwide, particularly in the Asia Pacific, Europe, and Middle Eastern regions.