There is nothing wrong with stating that the oil drilling business is flourishing rapidly. Regardless of whether your organization operates in Dubai or the United Kingdom, chances are, you may be scrambling to add on some latest equipment that will easily meet up the rising client demands.
No denying, the fracturing equipment, acid pumps, kill trucks, batch mixers and other assets can cost tens of millions of dollars. Because of this particular reason, numbers of oilfield and gas services firms opt to lease their equipment from oilfield and gas-related equipment providers. This will save you from paying big down payments and interest that come with traditional lending and helps your business to operate and expand smoothly.
Enlisted below are some reasons why renting equipment is way better than purchasing from an Oil Field and Gas Related Equipment Provider.
1. More Capital- Less Expense:
One of the undeniable advantages of leasing is you can save your hard-earned moolahs and can use in different sections of your oil business. When you lease equipment, usually there is no down payment. Without a doubt, when it comes to operating equipment, an open-end lease provides the utmost flexibility. If permits you to mention lease payment as an expense on the income statement. Not only this, this sort of lease gives important tax advantages without breaching or impacting the balance sheet.
Taking equipment on rent also saves you time as well as energy looking for a line of credit to finance a purchase. Furthermore, rather than buying, when you choose to rent, you also get the advantage of leasing expensive equipments. Unlike traditional financing, you do not have to pay every month to lessen the company’s interest, as most lease agreements give fixed terms for a period of 24, 36, 48, or 60 months.
2. More Flexibility-Less Risk:
Almost more than 80% of small to mid-size businesses feel safe in leasing equipment than owning. This is because they understand that rather than owning expensive equipment, they can get more profit by leasing, as it also provides utmost flexibility, especially in case of unpredictable expenses or an economic downturn.
Just in case, if you choose short-term leases, it will permit you to increase and lessen the sum of equipment your firm runs whenever the market slips down. In addition to this, it also helps you to know whether investing in the latest technology or equipment would be a good choice for your business or not, particularly in a long-term commitment.
3. Less Maintenance Headache:
Another benefit of leasing equipment is that you do not have to bother about routine maintenance. But, when you own any equipment one of the biggest drawbacks is that you become solely responsible for equipment maintenance. Needless to say, a sudden breakdown can lead to unexpected as well hefty expenses; moreover, it impacts your business’s productivity. But, if you have a full-service agreement, the Oil Field and Gas Related Equipment provide becomes completely responsible for its maintenance.
So, these were some advantages of leasing equipment. In case you need more assistance, feel free to get in touch with us.