When renting makes sense

Jill Berg of Advanced Test Equipment Rentals looks at some of the advantages of renting.

In today's rapidly evolving technical environment, companies' electronic equipment requirements are becoming more and more complex.

Management needs to have more options before taken into consideration the best solution to their problem.

Anyone who hasn't dealt with a rental company before might wonder as to the benefits.

Most rental companies represent a wide variety of general purpose, ATE, electronic and instrumentation equipment from many manufacturers, the two most popular being Hewlett-Packard and Tektronix.

Fluke, GenRad, Halcyon, Marconi, Sierra, Leader are some of the others.

With such a variety to choose from and from just one company, the answer is probably just one phone call away, and the company will have a specialist or applications engineer that has knowledge on the various pieces of equipment available and are impartial to any one of the kind.

This can benefit the customer by having several recommendations and prices to choose from.

Sometimes you will find a higher dollar amount for the more popular manufacturer, yet the equivalent model's specifications will fill your needs for less whether it's a purchase or a rental you are considering.

Renting is a solution to many electronic equipment needs: it can save time; it can save money; it addresses your emergency situation; it helps to control budgets; it helps when a crash project arises; it helps you to evaluate equipment before you buy; it helps with short-term projects; it helps with the overload periods; it protects against obsolescence; it's a saver when supplier fails to deliver on time; it's a saver when your own production equipment fails; and it saves maintenance cost.

The rule of thumb for renting equipment is 5 to 10% of the current manufacturer list price, usually with a one month minimum rental period.

However, some companies can be more flexible, especially if they have multiples in their inventory.

Another benefit in renting equipment is it is delivered with a full calibration and there is never a charge to the customer for its upkeep and maintenance.

Two big factors to consider when choosing a rental company are delivery and technical support.

Is stock kept locally where you can either pick it up or they can deliver in a satisfactory amount of time? Or is it shipped from another area? Will your company have to pay the cost? Is it shipped surface or air and will it reach you on time? How do you send it back? Is it at your cost? Consider the time in packing it up and the insurance cost.

Technical support may not appear to be an issue if you have knowledgeable technicians of your own.

But what if you run into a problem with the use of the equipment, whether it's a lack of familiarity or whether the equipment is faulty.

You'll need to know if there is someone on the technical staff that is capable and/or available to come to your location to help you out.

And in the event of equipment failure, can it be replaced or repaired immediately? This can cost in downtime.

It can cost an additional shipping fee if the company isn't local.

Another benefit from renting is in cost allocation.

For some companies the rental charges are charged directly to contracts or to a particular project.

Renting can provide use of the equipment without expending limited capital dollars.

Also, rental payments are deductible from pre-tax income, so leasing equipment can postpone tax payments.

Rental payments are usually higher than the depreciation rate on equipment, resulting in a tax decrease during the rental term and thus providing an increase available capital.

With an RWO plan (rent with option) a percentage of the monthly charge builds up equity on the equipment.

When the last invoice is converted over to a sale, your company can start benefiting from the depreciation, thus doubling the benefit.

Most rental companies have this type of plan.

Alternatively, rental companies will sell preowned equipment for less than the new price direct from the manufacturer.

The equipment will reach the original manufacturer's specifications and come with a warranty.

Extended warranties are also available.

You can expect to save from 10 to 50% off the list price! Rental companies have a need to keep inventory at "state of the art"; therefore, they must often sell off those instruments which, though still highly useful, have recently been superseded by a newer model or modification.

Thus buying preowned equipment lets you pay less for the features you need.

Rental companies are a good source for that old project that comes back to haunt you from time to time and the need for an obsolete piece of equipment that you need to keep the system working might very well be up in their attic.

So, what ever you need is, it's worth knowing your neighbourhood rental company.

Like any service company you choose there are many things to take into consideration, including: equipment availability; technical support and knowledge; personal service; delivery; and options.

Thousand of products or largest inventory doesn't necessarily mean the best, but service counts.

For those times you have a problem to solve make the acquisition of your test and measurement equipment easy.

Find someone who has the most reliable products.

Find someone who can deliver immediately.

Find the company that can back you by their support.

Find the one that can work with you on a variety of financial options.

And find the one that cares.

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