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YardBoss Lawncare
01-01-2013, 01:41 PM
Anyone ever considered renting a mower for their business? There's a local dealership/rental supply store in my town that rents Hustler Super Z's for $125. The rental fee is for 8 meter hours. You're able to keep it for 24 hours but you can only put 8 hours on the meter during this time. Doesn't sound like a bad deal if you have the high acreage accounts that are bid properly enough to cover this expense. I know that a few years ago I had an account that paid $175 every week. It took an hour and 45 minutes to mow, trim, edge, and blow the concrete off. Of that, probably an hour and 15 minutes was actual mow time.
Every other week they paid an additional $200 to mow a lot next they owned for a total of $1,100 each month. All in all, I spent about 14 hours each month on this account. With $500 a month going towards rental costs (4 x $125) I would be averaging $600 profit not counting fuel. $600 divided 14 is $42 per hour profit.
Obviously, I wouldn't use up the entire 8 hours allowed on the machine each week I rented it, so I would be able to include other accounts into the profit as well. I was just brainstorming on this and wanted some input or past experience from anyone else who has went this route in order to keep their credit to debt ratio freed up and save themselves the cost of purchasing a $9,000 mower outright.

JClark86
01-01-2013, 01:47 PM
$125 for 8 hours for a serious mower is a great price. I'm not an LCO, but we've rented mowers in the past for our properties. Choices here are slim - I can drive to go get a Bob-cat or get a local but expensive Exmark that leaves a crappy cut.

YardBoss Lawncare
01-01-2013, 04:08 PM
$125 for 8 hours for a serious mower is a great price. I'm not an LCO, but we've rented mowers in the past for our properties. Choices here are slim - I can drive to go get a Bob-cat or get a local but expensive Exmark that leaves a crappy cut.

Here's what I'm thinking:

Rental mower = $125 x 4 weeks each month = $500 per month
Being a rental, there is no cost 5 months out of the year (Winter)
Rental mower annual cost: $3500 ($500 x 7 mowing months)

Other option:

Borrowing $11,000 through a bank at 9.5% (less than great credit)
Monthly payments: $372
Annual cost: $4,464 ($372 x 12)

Being a loan, the payments are due each month of the year even in the Winter when not making any money vs the rental unit.

It would take 3 years of renting of a mower in order to spend the same amount of money ($11,000).
Obviously, with the loan route you would own the machine in 3 years not having anymore payments. But to be fair, hour for hour, lets say the mower you bought with a loan had 8 hours put on it each week since that's what the rental unit allowance is.
8 hours x 4weeks = 32 hours per month = 224 each year.
224 hours each year x 3 years = 672 hours.

At the end of the loan you will own a machine that has 672 hours on it. However, you will have also dealt with the struggle of making the payments in the down season. You will also be at risk if say your business goes under, you're still obligated to make the payments, whereas a rental unit simply gets returned. If you lose customers or decide to walk away, you just return the mower and don't have a bank note to worry about.

In the end, for long term benefits it's smarter to get a loan and buy a mower. But I wouldn't rule out renting one for your business if your credit isn't great or your operating capital is limited. Just my 2 cents. Still hoping to hear more opinions.

larryinalabama
01-01-2013, 04:19 PM
Id buy something used or lowend before I shelled out 3500$ per year.

ztman
01-01-2013, 04:25 PM
Looks like your equipment numbers work out, but I dont see your time factored in. Have to pu mower and drop it off when you want it, and what are you going to do if the mower is not available for rental when you want it. Sounds appealing based on your finance numbers, especially if you are worried about payments in the off season, but your time is worth something

YardBoss Lawncare
01-01-2013, 04:45 PM
Looks like your equipment numbers work out, but I dont see your time factored in. Have to pu mower and drop it off when you want it, and what are you going to do if the mower is not available for rental when you want it. Sounds appealing based on your finance numbers, especially if you are worried about payments in the off season, but your time is worth something

Well said :drinkup: I'm not sure about their reserve policy, but I would imagine a person could pay the $125 on say Monday and tell the rental company "I will be here Saturday to pick up the machine". That would probably guarantee it's there on the days you want it. I can't swear to it though without confirming it with the rental supply manager first. As far as time involved, that wouldn't be an issue as the rental store is near the house. Picking up and dropping off wouldn't tie up too much time in my case.

YardBoss Lawncare
01-01-2013, 04:49 PM
Id buy something used or lowend before I shelled out 3500$ per year.

I considered this too. I fear buying a used $5,000 machine and having the engine go out or a hydro 2 months later. After repairing something like that you're basically up there in the brand new price range/expense. I know what you're saying though. I've bought several used Grasshoppers in my day and I know it's a gamble but usually an unlikely problem if you check it out really good before buying. I'm just kicking this rental idea around to see what everyone thinks.

crazyflyboy30
01-01-2013, 06:09 PM
I considered this too. I fear buying a used $5,000 machine and having the engine go out or a hydro 2 months later. After repairing something like that you're basically up there in the brand new price range/expense. I know what you're saying though. I've bought several used Grasshoppers in my day and I know it's a gamble but usually an unlikely problem if you check it out really good before buying. I'm just kicking this rental idea around to see what everyone thinks.

I am in the same boat I know of a Scag Turf Tiger 52'' 27hp for $3000 after they give it a tune up ok so I wait 2 weeks still there did no't runing right so got a $5500 MZ6128zt this was 9/13/2012 .Then 2 days a go I stop by I said what did you with the Scag Turf Tiger ? He said it must have a "ghost" in it will run fine then quit so I am glad I did no't wait on the Scag.

jsslawncare
01-01-2013, 06:20 PM
Has any leased one for the season or something similar? Not rented.

retrodog
01-02-2013, 12:39 AM
The other benefit is tax breaks. Its alot better write off to lease over buy. I have been doing it a little here and there, but i have some serious businesses wanting to lease mowers all year. Talked to a dealer that leases nice mowers for $6000 a year, but takes care of maintenance included. He says that way he sees them on a normal basis and makes sure oil is changed and air filters are replaced...
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Duekster
01-02-2013, 12:58 AM
as others have said, Rentals are not a long term solution but could work in some conditions

IE rent a tractor for a quarterly field mow or skid steer for job