My firm design and builds houses for the customers. I fetched the contract for a huge warehouse construction. This will be my first big project. I usually do houses and small garages. For the new project, I need to upgrade the tools and equipment. I need an additional concrete mixer and a crane. Should I lease or buy? I read in this blog that leasing equipment would benefit from Tax. http://www.truckloancenter.com/blog/buying-vs-leasing/buying-vs-leasing-cost-effective/ . Also, I wouldn't be getting projects like these regularly. So do you think leasing the equipment would be the right thing to do?
Non Sequitur
Aug 8, 16 4:17 am
Can the mixer double up as a margarita maker when not used for concrete?
awaiting_deletion
Aug 8, 16 7:39 am
or just sub it out...
awaiting_deletion
Aug 8, 16 7:40 am
of course if it is a margarita mixer as well you can make some good extra money on weekends.
shellarchitect
Aug 8, 16 9:09 am
you can afford to buy a cement mixer and crane?
LITS4FormZ
Aug 8, 16 9:21 am
This is a serious question??
Always rent....
Non Sequitur
Aug 8, 16 9:25 am
A large contractor client of ours was getting tired of always renting the equipment needed for a job so he started a side business for equipment rental. Let's say he's doing rather well with that investment as I currently coordinate his custom multi-million dollar house drawings.
curtkram
Aug 8, 16 9:31 am
if you're a residential contractor building an industrial building, you're probably outside of your core competence and there would be a significant benefit in subbing concrete work out to someone more experienced with that specific construction type.
proto
Aug 8, 16 12:39 pm
[edit] like nonsequitur's comment above[/edit]
my understanding of the larger GC's practices is that they "own" the equipment via a brother company and rent it back to themselves (the GC company) and make money on it both ways
this goes for hand tools all the way up to large equipment
i believe it also divorces the GC's corporate equipment costs from the company making it more of a true services type operation
i'm only seeing this from the outside, so caveats & warnings about truthiness, YMMV
shellarchitect
Aug 8, 16 12:54 pm
in similar fashion, the contract may allow a markup to sub-contractors work, so every trade becomes a subcontractor, and the gc gets an extra 10% or whatever is allowed.
maybe not applicable to homes and private commercial work. More applicable for architects is the idea of one company owning a building and all equipment (computers, chairs, etc) and renting it to the architecture firm.
I don't know how common this is, but that is what one of my former firms did and how I got interested in the business stuff in the first place.
Alexi889
Aug 9, 16 12:23 am
I'm serious here. The firm doesn't have enough capital. My idea was to buy on loan. I had considered renting too. I have contacted some rentals. But, I had the thought to have equipment for the firm as we are having a storage space.
Non Sequitur
Aug 9, 16 12:48 am
We are serious too.
Have you considered consulting an astrologer?
shellarchitect
Aug 9, 16 12:53 pm
sorry, question seems a little crazy so hard to take seriously... why not wait until you've done a couple large projects before buying expensive equipment?
You don't want this stuff sitting around unused.
curtkram
Aug 9, 16 2:17 pm
how do you pay the loan off if you don't have enough capital?
poop876
Aug 9, 16 3:49 pm
No wonder you have no capital...you are clueless in your own industry!
Hello,
My firm design and builds houses for the customers. I fetched the contract for a huge warehouse construction. This will be my first big project. I usually do houses and small garages. For the new project, I need to upgrade the tools and equipment. I need an additional concrete mixer and a crane. Should I lease or buy? I read in this blog that leasing equipment would benefit from Tax. http://www.truckloancenter.com/blog/buying-vs-leasing/buying-vs-leasing-cost-effective/ . Also, I wouldn't be getting projects like these regularly. So do you think leasing the equipment would be the right thing to do?
Can the mixer double up as a margarita maker when not used for concrete?
or just sub it out...
of course if it is a margarita mixer as well you can make some good extra money on weekends.
you can afford to buy a cement mixer and crane?
This is a serious question??
Always rent....
A large contractor client of ours was getting tired of always renting the equipment needed for a job so he started a side business for equipment rental. Let's say he's doing rather well with that investment as I currently coordinate his custom multi-million dollar house drawings.
if you're a residential contractor building an industrial building, you're probably outside of your core competence and there would be a significant benefit in subbing concrete work out to someone more experienced with that specific construction type.
[edit] like nonsequitur's comment above[/edit]
my understanding of the larger GC's practices is that they "own" the equipment via a brother company and rent it back to themselves (the GC company) and make money on it both ways
this goes for hand tools all the way up to large equipment
i believe it also divorces the GC's corporate equipment costs from the company making it more of a true services type operation
i'm only seeing this from the outside, so caveats & warnings about truthiness, YMMV
in similar fashion, the contract may allow a markup to sub-contractors work, so every trade becomes a subcontractor, and the gc gets an extra 10% or whatever is allowed.
maybe not applicable to homes and private commercial work. More applicable for architects is the idea of one company owning a building and all equipment (computers, chairs, etc) and renting it to the architecture firm.
I don't know how common this is, but that is what one of my former firms did and how I got interested in the business stuff in the first place.
I'm serious here. The firm doesn't have enough capital. My idea was to buy on loan. I had considered renting too. I have contacted some rentals. But, I had the thought to have equipment for the firm as we are having a storage space.
We are serious too.
Have you considered consulting an astrologer?
sorry, question seems a little crazy so hard to take seriously... why not wait until you've done a couple large projects before buying expensive equipment?
You don't want this stuff sitting around unused.
how do you pay the loan off if you don't have enough capital?
No wonder you have no capital...you are clueless in your own industry!