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DOES IT MAKE SENSE TO RENT?

rent

Amid the myriad industries that rent light-duty trucks, many are the perfect fit. The industries where it makes the most sense to rent trucks are in construction of some form where business is done on a project basis, which is the key: project-based work.

CYCLICAL WORK

Organizations that rely on project-based work understand their revenue is cyclical—meaning when they have projects, they get paid. But when they don’t have projects, they don’t get paid. Many construction companies struggle financially during downtime, especially when making payments on fleet trucks they own. What’s the point of paying for your work trucks if they sit in the yard while there are no projects? This is why a majority of construction companies decide to rent some or all of their fleet trucks. They only pay during “uptime,” or when they have projects. They don’t pay during downtime.

SIMPLE PROCUREMENT

Unlike long-term leasing or purchasing your fleet, renting allows you to procure the vehicles the week you need them, use them during the life of the project, and release them once the project is complete or when you no longer have a need for the vehicles. When you don’t have projects, there are few or no trucks sitting in your yard.

Some truck rental companies, such as Flex Fleet Rental, deliver the trucks directly to your jobsite and pick them up from there, making the life of a fleet manager a breeze!

Among the many construction industries are a handful of the most fitting for renting vehicles. They are general construction, pipeline, oil and gas, solar, wind, electrical, environmental, and infrastructure.

GENERAL CONSTRUCTION

The most common types of construction are encompassed within the general construction category. Typically when the average person thinks of construction, they think of a project within this industry. It includes but is not limited to residential, small commercial, road construction, and demolition. Work in the general construction industry is inherently project-based and is a no-brainer industry in which to rent trucks. Some examples of projects in this sector include highway construction, single-family home building, and small residential demolitions. Projects typically range from one to 12 months in this sector.

PIPELINE

Pipelines play a huge role in everyday lives and are essential to many industries in the United States. They are networks that deliver crude oil, gasoline, diesel fuel, jet fuel, home heating oil, and natural gas. Within this industry, pipelines are constructed over a three- to 12-month period. Although this timeline is typical, some pipeline projects run only a few weeks, while others span longer than a year. Most pipeline projects require a medium to large workforce, thus requiring more vehicles to optimize a company’s fleet.

Many pipeline projects are in the north central region of the United States, and as one can imagine, the winters in this region are usually unforgiving. Many pipeline construction companies close shop or halt construction during this time, leaving many fleet trucks to sit in yards unused. As stated before, no trucks sit in yards when renting. You can simply take them “Off Rent” until your next project starts in the spring. This can save thousands of dollars in fleet costs.

OIL AND GAS

In terms of dollar value, the oil and gas sector is said to be biggest in the world. It employs hundreds of thousands of workers and generates hundreds of billions of dollars across the globe each year. Within the industry are three areas: upstream, midstream, and downstream.

Upstream
Upstream, also referred to as E&P (exploration and production), comprises the search for natural gas and crude oil fields and the drilling of wells to recover the oil and gas.

Midstream
Midstream involves the transportation, storage, and processing of oil and gas. Once retrieved, the resources need to be transported to a refinery, which is sometimes in a different region. Transportation methods typically include tanker ships, pipelines, and trucking fleets.

Downstream
Downstream entails the refining and purifying of the raw materials. Once a refinery receives these materials, it goes to work refining the oil and purifying the natural gas to be used in various forms including diesel oil, jet fuel, gasoline, lubricants, petrol, kerosene, heating oil, and natural gas among others.

While truck rentals are common in all three subsectors, upstream and midstream use them the most with upstream using vocational, day-use trucks most often.

SOLAR

The solar power sector is a growing industry of renewable energy taken from the sun and converted into thermal or electrical energy. It is the most abundant and cleanest renewable energy source in the world. Generally, the construction aspect comes into play with solar panel farms where hundreds if not thousands of solar panels are constructed and generate power to a main source. Currently, there are thousands of solar farms in the United States.

Because the sun is the most powerful in the Southwest region of the United States, most solar farms are located within this area. However, many northern and eastern states are jumping into solar power. Given the expanding territory, some solar construction pauses during the extreme winter months, leaving fleet vehicles unused for a portion of the year.

WIND

Another industry where renting fleet vehicles is logical is wind power. The wind power industry involves the design, manufacture, construction, and maintenance of wind turbines. Wind farms consist of multiple individual wind turbines connected to an electric power transmission network. Like solar farms, there are thousands of wind farms in the United States at this time.

ELECTRICAL

The electrical construction sector is responsible for bringing electrical power, communications, and lighting to buildings and communities throughout the world. Electrical construction consists of small or large projects. The larger projects can last between six and 12 months—another industry very fitting for fleet rental.

ENVIRONMENTAL

The industry of environmental construction is comprised of organizations that provide solutions surrounding sustainable building practices, green construction, and appropriate cleanup of land that may be unsafe for construction or use. Depending on the project type, the time these typically last is between three and six months but can extend longer where necessary.

INFRASTRUCTURE

Within the infrastructure construction sector are organizations that work with civil engineering companies to complete large scale construction projects including bridges, dams, pipelines, road networks, ports, aqueducts, and large buildings. As one can imagine, these projects last many months and often into years.

If you work in one of these construction industries and haven’t yet considered renting part or all of your fleet, you may want to start. From a financial and ease-of-use standpoint, renting just makes sense.

ABOUT THE AUTHOR

With more than 16 years in marketing including digital and traditional, Jan Eliason is currently the director of marketing at Flex Fleet Rental and thrives on driving high quality leads and creating an unforgettable brand. Find out more about Flex Fleet Rental, visit www.flexfleetrental.com.


MODERN WORKTRUCK SOLUTIONS: OCTOBER 2018 ISSUE

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