Obtaining equipment is a huge commitment that many companies may or may not be ready to pursue. Many seek traditional alternatives like buying equipment, while others follow a contemporary route by renting or leasing equipment. Whatever the choice, Frain is here to help clarify some common myths.
Myth 1: Purchasing is always the way to go.
While purchasing equipment may be the right solution for some companies, it is certainly not a one-size-fits-all approach. Buyers often rely on advisors with little-to-no knowledge of the industry, equipment or application to guide their decision. Thus, businesses may purchase equipment not best suited for the job. This creates setbacks that companies are usually not prepared to manage such as cash flow constraints. On the other hand, companies that are well advised and have successfully introduced the product to market are best suited for equipment purchases.
Myth 2: Purchasing NEW is the only risk free solution.
Many individuals and companies prefer to buy new (OEM) equipment because of the machine warranty and established name. Others prefer to buy new because it has become part of the business routine. Several companies have a difficult time understanding that purchasing new equipment is not the only risk free solution. With used certified pre-owned machinery offering the same warranty as OEM’s at a faster turnaround times and satisfactory guarantees, companies can save time and money on equipment purchases. This, consequently, decreases downtime and gets the product to market faster than the traditional OEM solution.
Myth 3: Alternative procurement methods are too risky or nerve wrecking.
As stated above, some companies are set in their ways and often turn to purchasing equipment because it is what they have done for years. The fear of doing something that can cost the company a lot more than it saves holds several individuals back from innovation. A lack of adaptation can push toward the demise of an enterprise, and has held true in different cases from animal extinction to equipment and technology. In the packaging and processing industry, Frain responded to the way the consumer market seeks equipment with an innovative rental option that gets products to market faster. The rental option offers several benefits, including a lower investment, manageable payments, cash flow control, and increased production. A flexible program, like Frain’s rental service, is best suited for seasonal peaks, product introduction, company expansion, or contract packagers, but anyone can take advantage of it.
Myth 4: Renting and leasing are basically the same.
Leasing offers a hybrid of the contemporary rental and the traditional purchase. It allows individuals to purchase equipment while spreading out payments as desired by the customer (12, 24 or 36 months). This flexibility gives the customer cash flow control and insurance from purchasing equipment outright. This opportunity may not be suited for everyone, but many individuals find comfort in flexible operational and/or capital costs.
In general, obtaining equipment can be challenging. Ultimately understanding the needs of the business, project scope, company capital, and testing the effect of a new product or production increase will aid in weighting the pros and cons of a machinery purchase, rental or lease, and help individuals make educated decisions.
Not sure where to start or how to get the equipment you need? Frain can lead the way.
