A common question which often pops up when big capital acquisitions are being considered is - 'should we buy or lease?'
If you're looking to bring on new machines on a long-term basis, both options have their advantages, and bring many of the same benefits — but depending on the nature of your company and what your daily challenges are, one solution will likely be more beneficial.
If you’re looking to get a new forklift truck which will provide you with years of reliable service, rather than just a short-term hire forklift to help you deal with periods of high demand, your first thought may be to purchase one outright.
Owning and operating a forklift truck naturally involves many different costs. There's naturally the upfront cost of the machine itself, or regular payments if it's financed, as well as costs for routine or avoidable service and maintenance, and downtime.
As anyone who's been responsible for costs in a warehouse knows, order picking is often the most expensive warehouse operation.
Loading and unloading naturally has associated costs, and stacking can be expensive - but neither come close to the cost of order picking.
On 1 January 2019, IFRS 16 Leases will come into effect, and it's going to have a big impact on the material handling industry.
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