Cranes are a necessity for many construction jobs. If you use cranes regularly in your work, you may consider buying a used crane to have one available at all times. However, purchasing any crane is a significant investment. Before you make the purchase, you should understand the benefits and drawbacks of buying used cranes compared to renting.
For instance, if you use a particular crane model on most of your projects, buying a crane might be a worthwhile investment. On the other hand, if your projects are constantly changing and you need different models for each, it might be better to rent.
That leaves an essential question if you’ve considered buying a crane: How do you know if it’s the right decision for you? Read on to learn the pros and cons of owning your crane and whether searching for used crane sales is a good fit for your business.
Is My Company a Good Fit to Buy a Used Crane?
Before you think about the pros and cons of buying a used crane, you should think about whether your business would benefit from owning a crane outright. When you buy a crane, you’re making a more significant investment than just the purchase price. You’re also taking on responsibility for the long-term costs of its maintenance and storage.
When they run the numbers, some companies discover that renting cranes is more cost-efficient than buying them. Here’s how to tell if your business is a good fit for buying a crane outright:
- Your company regularly performs jobs that require a particular type of lifting, or it uses a specific crane model at least a few times a week.
- You have an immediate need for a crane that is not available for rent, and you plan to continue to use it for future projects.
- Your business is a crane rental company that is looking to grow its fleet.
- You are prepared for 20-plus years of owning and maintaining a crane.
- Your business has the funds and the resources for the upkeep required.
- Your business has dedicated equipment operators who are trained or licensed.
- You have on-site storage, a repair facility, and a means of transporting the crane.
Essentially, you need to be prepared for everything that comes with crane ownership. If you already have experience owning cranes, have the facilities and expert staff to keep the crane in good shape, and are prepared to make a significant investment to keep the crane operational, then buying a used crane may be a good idea. If you don’t meet any of the criteria above, though, you’re most likely better off continuing to rent until you’ve grown your business more.
Pros of Buying a Used Crane
Even if your business is the perfect fit for purchasing a crane, you should still think carefully before making your purchase. If you understand the benefits and drawbacks of crane ownership, you’ll be able to make an informed decision and buy the perfect machine for your needs.
There are many benefits to owning a crane, of course. Some of the biggest draws of buying a used crane include the following.
1. Avoiding Project Delays
If you only rent cranes, you’re always at the mercy of the market when it’s time to start a project. If the specific model you need is rented out, you won’t be able to begin work until it’s returned. That can add significant delays to a project.
However, if you buy a crane, you can avoid these delays entirely. You’ll have complete control over the machine, so it’s guaranteed to be available when you need it on-site.
2. Saving Money
Over time, buying a used crane can significantly reduce your costs. With heavy-equipment financing, you can spread out the cost of purchasing the crane over time. The right financing can help you access up to 100% of the purchase price of the crane, avoiding a costly up-front investment. This is particularly true of used cranes, which aren’t as expensive as brand-new models.
Meanwhile, you won’t be spending money on regular rentals; you’ll be building equity in the equipment. You may even be able to finance training for your employees to use and care for the crane.
3. Receiving Tax Benefits
Depending on your business and how you finance your purchase, you may be able to deduct some of the expenses of buying the crane from your taxes. This can help you receive certain tax benefits, saving your business money. You may even be able to offset some of your purchase costs through these tax benefits.
4. Making an Investment
If you take good care of a crane, it will retain value. Most heavy equipment retains significant resale value when it’s well-maintained. After all, if you’ve purchased a used crane, it stands to reason that other people are looking for similar used crane sales.
This makes buying a used crane an investment. You’ll be able to sell or trade the machinery in the future if you want to upgrade to a newer model.
Cons of Buying a Used Crane
Despite these benefits, purchasing a used crane still has some drawbacks. It’s essential to be prepared for the potential issues you may face before you make a purchase. After all, purchasing a crane is a long-term capital investment. Before you take on that expense, you need to weigh your options to decide whether renting or purchasing a crane is a better fit for your business. Potential cons of buying a used crane include the following.
1. Waiting to See a Return on Your Investment
Depending on the crane you buy, it can take years before you see a return on your investment. A well-maintained crane can last for decades. However, buying a used crane locks you into paying the total purchase price as well as maintenance and storage. If you don’t use a crane regularly enough, these expenses can amount to more than what you were paying for rentals. You need to make sure you’ll use the crane frequently if you want to justify the costs and guarantee a return on your investment.
2. Risking a Poor Purchase
If you don’t carefully research the crane you want to buy, you may end up making a bad investment. One possibility is that you accidentally buy a crane that doesn’t fit the specifications you need for your projects, making it useless. Another possibility is that you work with an unscrupulous used crane dealer and wind up with a machine that needs significant repairs to be functional.
For these reasons, you should make sure you work with a crane dealer you trust. Sellers with a good reputation in the industry will walk you through the process so you don’t buy something that will waste your money.
3. Paying Routine Maintenance Costs
After your purchase, you’ll be responsible for all of the costs going forward. These include:
- Maintenance and repairs
Make sure you include these numbers in your calculations when determining whether a purchase will actually save you money. Rental companies handle these expenses for you. If you need a crane only occasionally, it will be cheaper to rent the crane and avoid these costs.
4. Maintaining Crane Operator Certifications
When you own a crane, you’ll most likely need your operators to have additional licensing. You’ll also be responsible for the cost of having your staff properly trained and certified, particularly if you’re taking on the setup and installation of a crane for the first time. This training is essential if you want to keep your job sites safe.
5. Taking On Liability
You’ll need to get the right kind of insurance coverage for your projects, your job sites, and the machinery itself. You might also need liability coverage for operating and transporting the crane. These costs should also be kept in mind before you decide to buy.
Which Is Right for Me? Buying or Renting?
So when does it make more sense to buy vs. rent a crane? It all comes down to utilization.
How often will you be utilizing the crane throughout the year? For how many years? For example, suppose you’re using a crane four times a year. Consider the cost per hour for that level of use when you rent compared to when you own.
Renting a crane entails just a flat hourly rate, plus perhaps an installation and transportation fee for each use. As an owner, though, you’re responsible for that crane all year long. That involves paying a lot more to cover the costs of insurance, transportation, and maintenance.
The story’s a little different if you’re going to be using your crane multiple times per month all year long. A crane becomes a worthwhile investment when the cost of annual ownership is less than what you spend on renting one throughout the year.
That’s why renting is better than owning for companies that only occasionally use cranes or use a wide variety of cranes on their jobs. Renting gives you a vast range of options to choose from, including different sizes and configurations. If your jobs require flexibility regarding the types of cranes you use, renting is likely your best option.
Furthermore, crane rental companies will often offer trained and certified operators as well as transportation logistics. Some rental companies even offer maintenance and repair services. All of these perks take weight off your shoulders and save your business money.
However, if you’re renting the same crane model multiple times a month or keep the same model on-site for weeks at a time, then it might be better to buy. That’s when all of the costs, from insurance to storage to transportation, may wind up being less than the cost of renting the cranes so frequently.
To determine whether you should rent or buy, you need to do your research. Take the time to run the numbers for your company and the prospective used crane sale that interests you to see whether buying or owning is more cost-effective. This can help you avoid wasting money either way and ensure that, should you buy a crane, you’re doing it with your eyes wide open.
Make the Crane-Buying Decision That’s Safest and Smartest for Your Company
Purchasing heavy equipment like a crane is a major investment. Before you decide whether to purchase or not, you need to consider your business’s circumstances. Whether you choose to buy or rent cranes in the future, you must also consider safety.
If you own the crane you should be prepared to follow strict regulations and guidelines on crane maintenance, storage, and training, as well as safety precautions at the jobsite and during transport.
If you already use cranes regularly, you’re most likely familiar with these requirements. The best way to ensure that you make the right decision for your business is to get in touch with a crane provider that has established a good reputation in the industry. If you rent from a crane supplier, talk to a representative about your needs to see whether purchasing a crane is a good fit for you and your business. At Maxim Crane, we have high-quality, well-maintained pieces of equipment for rent and for sale. Get in touch today to learn more about buying safe used crane from a provider you can trust.