Deciding Whether to Buy, Lease or Rent a Forklift

There's no getting around the fact that material handling and distribution center warehouse equipment is expensive. When an owner invests money into material handling equipment, they expect to see a good return on investment (ROI) in the form of increased productivity and efficiency that boosts the bottom line and helps pay for that equipment. With a wide variety of material handling and DC warehouse equipment available, there seems to be something for every application. Of course, the more bells and whistles, the more money! So, how do you decide if buying, renting or leasing material handling equipment - such as a forklift - is right for you? Let's break down some of the important factors to take into consideration beforehand.  

Whether you believe there is a climate change crisis or not, material handling and distribution center warehouse managers and decision makers are moving toward electrically-powered equipment for some very good reasons that include environmental concerns, but also consist of maintenance costs and fossil fuel price fluctuations, as well as fuel stability. With a tremendous rise in e-commerce as the world adjusts to new normals, moving toward electric just makes sense. 

 When it's time to buy an expensive piece of material handling equipment, most decision makers are going to weigh the pros and cons of purchasing new vs used. In fact, when you plan your annual budget, you've probably included a line item for additional needed forklifts and other material handling equipment like stackers, order pickers, reach trucks, utility carts, aerial lifts, yard ramps, jacks and more. Perhaps you had the discussion about the advantages of buying new vs the advantages of buying used at that time. It's just good business sense to plan ahead and buy the big items on a planned schedule when you can take advantage of sales and tax breaks. One thing is for sure, though. You don't want to get caught with serious downtime while you debate the pros and cons of new vs used.

Obviously, a used forklift is going to be less of a hit to the bottom line - at least at first. Therein lies the caveat. The advantages of buying new material handling and distribution center warehouse equipment boil down to cost and features. Let's take a closer look at how these items can affect your purchase decision.

Most up-to-date businesses that use forklifts and other equipment are managed by people who are aware of how important safety is to owners and employees alike. And yet, forklift fatalities and accidents not only continue to happen, but have seen an increase over the last 10 years. In 2019, OSHA reported 79 deaths and more than 8,000 injuries due to forklifts. Granted, there are more forklifts and more people operating them, but with workplace safety being spotlighted all day every day, what can possibly be at the root of these numbers? 

Capital investments - the purchase of items that boost productivity and cost more than $5,000 - are part of every company's solid financial budget. Capital investments, such as material handling equipment like forklifts, are expected to show a positive ROI, or return on investment, almost immediately - or at least by the following year.

Companies that are planning on growing - or are already showing positive growth - need to be able to make decisions about capital investments and how the ROI is going to affect the bottom line. Do you anticipate your company growing faster with the addition of a forklift? Adding capital investments in the form of equipment such as a forklift can not only boost your productivity, it can help you increase your workforce and expand your business into new markets.

Let's take a look at some of the signs that buying a forklift would be the right choice for your company.