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Rental Equipment

Discussion in 'Rental Equipment' started by organiclawncanada, Aug 16, 2010.

  1. organiclawncanada

    organiclawncanada LawnSite Member
    Posts: 94

    If you have to rent equipment do you mark it up to the customer or just build it all in?:canadaflag:
  2. MarcSmith

    MarcSmith LawnSite Fanatic
    Posts: 7,157

    mark it up...usually around 30%
  3. clydebusa

    clydebusa LawnSite Bronze Member
    Posts: 1,660

  4. Lefet

    Lefet LawnSite Bronze Member
    Posts: 1,887

    And do you base that on a 4 hour rental or a 24 hour rental?
  5. MarcSmith

    MarcSmith LawnSite Fanatic
    Posts: 7,157

    doesn't matter...what ever the rental charge is you mark it up and pass the bill along. and also read the fine print. most rentals for 1/2 day are 4 hours, and a full day is 8 hours of actual usage...not 24 horus of clock time. assuming the hour meter works...

    now if you can rent something Like an aerator and use it on multiple jobs, then you can prorate the rental across all the customers...

    I actually had one rental this winter for snow removal, and we used it for about 100 hours in one week rental. and we got dinged for 2 .5 weeks. base don the hours used...
  6. Lefet

    Lefet LawnSite Bronze Member
    Posts: 1,887

    Gotcha, good info, thanks.
  7. organiclawncanada

    organiclawncanada LawnSite Member
    Posts: 94

    Thanks that is good info to know.
  8. MarcSmith

    MarcSmith LawnSite Fanatic
    Posts: 7,157

    question for ya.

    why would you consider NOT marking the prices up?
  9. nepatsfan

    nepatsfan LawnSite Gold Member
    Posts: 3,142

    Because you are already behind the 8 ball if you don't own the equipment. In order to stay competitive I don't see how you can charge a customer a premium on renting something that other landscapers already own outright. For instance if you go rent a skid steer for 250 a day, then charge 30 to 40% on top of that thats up to $350. If this is a one day job....you aren't gonna get it unless you want to work yourself for about 15 bucks an hour. Its very hard to mark up a rental and stay competitive. I haven't rented anything in years but I would break even on a rental and try to get a decent days pay until you can afford to buy the equipment.
  10. MarcSmith

    MarcSmith LawnSite Fanatic
    Posts: 7,157

    Ne I can understand your logic.... and I can agree with it to a point... but by using your logic when we mark up materials for a job we are loosing a competitive edge to the nursery who does installs or to the larger company that has better buying power and gets lower prices...

    Marking up the prices covers my costs for renting the equipment, picking it up, floating the payment on the bill and dealing with any potential down time issues..

    I provided full landscape maintenance for my clients in Florida... I was very anal about not letting other landscapers on the properties I maintained. and my relationship was good enough that my clients trusted me. Routinely I would rent man lifts/bucket trucks to do palm trees as the Clients asked. I always tried to group the jobs together so to minimize the rental fees for all involved. so would it have been wise for me to save up and spend 40-50K on a bucket truck plus insurance, plus maintenance for a piece of equipment that I'd use a dozen times a year... No...

    I had several large commercial properties where I subbed out the parking lot sweeping. I guess I could have spent 80K on a sweeper, but no It was smarter to sub out and markup....

    by marking up equipment...yes you loose some competitive edge if your clients are bidding the job to multiple vendors...but if your clients are not bidding the job out, then you don't have the competitive edge to worry about...

    when i rented a dumpster you better bet I was marking it up...but I guess I could have saved the money and bought my own dumpster, and then another 120K for a roll-off truck for the 3-4 times a year I would have used it

    when you currently bid a job out which equipment you use and its cost to operate better be considered in the bid...otherwise you ARE leaving money on the table...

    There are instances when its nice to rent if you don't have enough jobs to justify the expense of a new piece of equipment.

    So a 250 dollar rental for the day you ad 75 bucks......and you are still short on the time it takes to arrange the rental pick it up and return it

    Oh and my question was more of a thinking exercise for the OP to see what reasons he had for NOT marking it up...

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