There are many types of semi-trailers on the market for you to choose from dry van trailers, low-bed trailers, dump trailers, flatbed trailers, and so on. In addition to deciding which trailer to use, you also have to choose between buying, leasing, and renting a trailer.
Buy a semi trailer
Buying a semi-trailer is a significant investment. You have many rights to use or modify it during the payment period, and you will get full the rights after paying off. This provides the best peace of mind and certainty.
Advantage:
- In the long term, buying is the cheapest option.
- Become your tangible asset, which can increase the valuation of your business
- Ability to customize and upgrade semi-trailers
- You can also choose to sell to get a return on your initial investment
- There may be tax incentives for direct purchases
Disadvantage:
- Need a lot of capital investment upfront
- Maintenance may add additional costs to your balance sheet
Lease a semi trailer
Different with trailer rents, lease a semi trailer usually refers to a longer time. The supplier will retain the ownership of the trailer. If the lease is not renewed, the trailer needs to be returned at the end of the lease. Of course, you can also choose to buy the trailer at the conclusion of the lease.
Advantage:
- Lower upfront cost, lower than purchase
- Interest rate is more favorable than rent
- Trailers optimized for specific purposes
- There is no risk of manufacturer delays affecting the availability
- After signing a long-term agreement, you can customize the trailer according to your requirements, including the trailer’s logo
Disadvantage:
- The lease needs to be renewed regularly
- If you need a long-term lease, it may be more expensive than buying
- Unable to increase business valuation
Rent a semi trailer
Trailer rents usually refer to a short-term contract signed with a supplier. It is a short-term solution that can meet your transportation needs. For example, as a transport fleet, when semi trailers cannot be coordinated, you can use rented semi-trailers as a means of turnover. If you meet the following conditions, renting is a good choice:
- Promptly needed equipment
- The workload has seasonal fluctuations
- Requires trailer for a short period of time
- Are starting a business and need a trailer to meet your immediate needs as you develop your long-term strategy
Advantage:
- Quickly fill the gap in transportation capacity
- Suitable for starting a small business, and there are not enough funds to invest in heavy equipment assets
- Flexible, it is the best choice when you cannot determine how long you need to use
Disadvantage:
- Higher rate, which is higher than lease or purchase
- Will not provide your business with liquid assets, nor will it increase business valuation
- Can’t customize the trailer or add your brand to the trailer
- If the trailer is damaged during use, you may need to compensate
My niece wants to increase the distribution output for her skincare products. It’s good to know from your article that leasing a semi-trailer would help us avoid any possible delay from the manufacturer. I’ll certainly forward this article to her so she’ll make the right deal later.