Forklift rental continues to dominate the materials handling market with ever-increasing momentum as the forklift procurement method of choice. Long term contract rental of forklifts in particular now far outstrips outright sales as the method through which most new forklifts find their way onto the floor of industry.

This phenomenon is grounded in three very solid business principals – peg your costs, preserve your capital and stick to your knitting. After a brief overview in this blog, the next three blogs in this series, brought to you by A Square Forklift, will deal with each of these self-titled principals in detail.

By opting for rental of forklifts, companies pay a fixed monthly fee for an allocated number of operating hours. This rental rate is made up primarily of capital (finance portion) and a maintenance portion. This allows the company to budget accurately with no ugly surprises resulting from high repair costs which may unexpectedly present themselves on owned forklifts. It is important to bear in mind, however, that the obvious monthly cost is not the only pegged cost. The other, possibly more substantial, albeit often forgotten fixed cost benefit, is a reduction in downtime and avoidance of production losses which could far outstrip the mere operating costs of the forklifts. This is particularly true when renting forklifts, reach trucks or warehousing equipment from A Square Forklift.

As a unique non-negotiable cornerstone of A Square’s business model, any rental forklift which will be down for longer than 24 hours is replaced by a model of similar specification in order to keep the client operational – mostly negating the risk of downtime and production losses – until the forklift is once again fully operational. In a case where a client owns their equipment, such a replacement would be at their cost – furthermore adding to unplanned costs – whereas A Square Forklift provides this service, including the transport of the replacement forklift, at no additional cost to the Rentor.

In the case of a breakdown on one of A Square Forklift’s rental units, it is just one phone call and the customers time and focus can return to their operation – without the need to be caught up in sourcing of repairers or short term rentals, which are not part of their core business or expertise.

It is, of course, not just these unbudgeted maintenance, rental, transport or downtime costs which deprive companies of their hard earned capital in the case of owned equipment. It is also the ever increasing capital outlay to acquire the equipment which affects cash flow and ties up valuable working capital far better employed in the enterprise’s core activities. Indeed the depreciation on an asset which never increases in value has a direct impact on the bottom line without any real value retained at the end of the period. It could be concluded that a forklift is a tool or commodity critical to operations, but which adds no tangible asset value – and, as such, could rather be viewed as a liability – at very least an operating expense which should sit under the expenses section of the Income Statement rather than the Balance sheet.

Whilst A Square Forklift is happy to supply any of our forklifts or warehousing equipment, new or used, through direct sales, our Nichiyu, Combilift Aisle-Master and Mitsubishi products are all available through the lucrative rental offering, tailored to suit your exact requirements.

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