Renting vs Buying Shipping Containers: Which Is the Better Option for Your Business?
Nov 6, 2019
Acquiring a shipping container may sound like a simple task, but things can get a lot more complicated when you start to narrow your options down.
Just like any big purchase, there are a number of factors that can define the success of your logistics investment. Considering the number of options in the container market, the unique demands of your circumstance, and the capability of your budget, you may end up making a bad purchase if you go out and buy a container impulsively.
As business owners, you should always find ways to lower your expenses while gaining maximum benefit.
With these things in mind, you’re probably wondering what’s more beneficial between renting or getting your own unit. Renting a shipping container can be an affordable short-term solution while buying one a shipping container can be a great long-term investment.
If you’re torn between the two options, this guide will give you some insight into what choice will work best for your business.
Pros of Renting Shipping Containers
1. Less Expensive
Purchasing a unit is usually a one-time transaction that requires you to shell out a significant amount of money. If you need to get a container as soon as possible but you don’t have the liquidity to buy one outright, paying by the month will definitely be the more doable option.
Just like your credit card and electricity bills, make sure that you pay on time to avoid any violations and penalties.
2. Don’t need to store it after single-use
Buying your own unit means that you have the financial and storage capacity to store it. If your shipping container unit is just sitting around your factory, it will eventually turn into a useless expense and add to your current list of liabilities.
If you only need to make large deliveries every once in a while, then renting one should be the cost-efficient option for you.
When it comes to leasing a model, you won’t need to worry about extra storage expenses. Once you’ve finished using it, just call the company you’ve partnered with and they’ll gladly claim and return it whenever you please.
3. Any unintentional physical issues/damages will be handled by the rental company
In case you discover a leak or a malfunction in the unit you’ve borrowed, you aren’t obliged to pay for the repairs.
When it comes to wear and tear, vandalism, and any other unintentional damages, most technical container issues will be shouldered by your partner company. As long as you handle them with care, you won’t need to worry about refurbishing and other repair expenses that may put a large dent in your budget.
Before you make an agreement with your renter, develop the habit of inspecting every part of the container carefully. This should help the two of you avoid any unwanted complications that may could up in the future.
4. More flexibility with your deliveries
If you plan on buying a shipping container, that unit will stay with you indefinitely. Given that your business is ever-growing, your delivery needs will also increase over time. You may deliver your products in larger quantities so you’ll eventually need to switch from one kind of container to another.
In case you need to make an upgrade (or even downsize), you can just ask your rental company to give you a container fit for your situation.
Cons of Renting Shipping Containers
1. Limited Use
If the items you’re delivering don’t have any unique shipping requirements, then renting is a great choice for general use.
However, if the nature of your business requires you to ship exotic products, some container rental companies may prohibit certain items from being delivered. Before you sign any agreements, be transparent with your lessor and ask for a list of the things that can and can’t be shipped.
2. Monthly payments can get expensive
Renting may seem less expensive at first glance, but you may end up spending more money than what you expect if you rent for longer periods. Try to predict the number of deliveries you’ll make in the future. If you think that your deliveries will continue to grow in number as the years go by, it may be a better choice to just buy your own containers.
3. Availability Limitations
The unit you may need may not always be available. Having your own container means that it’s readily available at your disposal. In case a spontaneous delivery comes up, you may encounter some delivery issues if the unit you’re planning to rent is still being used by another person.
Pros of Buying Shipping Containers
1. Single Upfront Payment
Unlike rentals that come with monthly bills and other related fees, buying a container will only require a single upfront payment (unless you’re paying in installments).
Buying one may seem very daunting at first, but it could actually be a lot more beneficial in the long run. Renting may be the cost-efficient option at present, but if you do the math and add your increasing requirements in the years to come, that expensive price tag can actually be a lot cheaper than accumulated rental fees.
Even though you may end up spending on periodical repairs and maintenance checks, you’ll also acquire more convenience by eliminating availability and other logistical issues.
2. Ownership and multiple uses
Once you pay off your container, you can use it for whatever purpose you have in mind.
Even though shipping containers were made for delivering goods, nowadays designers and architects tend to incorporate various models when constructing building infrastructure. Since it’s sustainable, inexpensive, and aesthetically pleasing, more containers have found its way into different houses, offices, and restaurants.
If you want more control over your deliveries or if you want to improve the function and design of your building, buying your own container will be one of the best investments you can make. To help you get started, BSL containers offer a wide range of options.
3. You can customize it to what you want
When the time comes that you suddenly need to repurpose or redesign your containers, you can purchase the necessary add-ons and make any alterations with ease.
To address unique client needs, most container retailers have customization services readily available. If the products you’re delivering require certain features for preservation or if you want your product to match your home’s design, your dealer will be glad to adjust openings, add air-conditioning, or even split the unit in half.
4. High Resale Value
Unlike gadgets and vehicles that depreciate over time, containers can potentially have high resale value.
If you no longer need a container or if you’re planning to buy a newer unit, you can still sell your old container at a relatively high price. As long as you’re able to maintain its quality or increase its value through upgrades, you can quickly regain the hard-earned money you’ve previously spent on it.
Cons of Buying Shipping Containers
1. Generally more expensive
Buying your own unit is generally more expensive than renting.
Even though buying a container is usually a one-time payment, your current financial condition may not allow you to make such a large transaction. If you want to minimize the impact of your expenses and avoid making large loans, consider adding second hand containers to your list of options. Used containers come at reasonable prices and basic repairs are affordable.
2. Comes with hidden expenses
Other than dealing with hefty price tags, buying your own container will also come with hidden costs. You may spend extra on refurbishing expenses, storage fees, and other kinds of add-ons. Regardless of what you buy and who you buy it from, make sure that you do regular check-ups to maintain its quality and minimize preservation costs.
3. Size limitations
When you’re about to make a purchase, size should be the first thing that you consider.
Unlike rentals that can be disposed of and replaced, buying will mean that the unit is yours indefinitely. You may be able to adjust openings, add windows, and install temperature regulators, but one thing you won’t be able to customize is its dimensions.
Since your delivery situation may vary from one partner to the other, you may even end up buying different kinds of units.
New vs Used Shipping Containers
Just like any big investment, it’s important that you approach things slowly. With all these pros and cons in mind, take the time to analyze your situation and ask yourself:
What option will provide the most convenience at the lowest price?
Renting a shipping container is a better option for businesses that deliver occasionally. If you can’t afford to make large payments along with storage and maintenance fees, renting a unit will address your needs while lessening your overhead costs. Just make sure that you partner with a credible leasing company for smooth and seamless transactions.
On the other hand, buying one is a good idea for long-run operations. If you’re constantly shipping or if you’re planning to use your container for building construction, you should definitely buy your own units. As long as you can afford one without breaking the bank, purchasing one will always be the better option.
An excellent balance between practicality and price makes an investment successful. If you’re still undecided on what option to choose from, always remember:
The best choice you can make is the one that will save you more money in the long run.
Think about your purpose, requirements, and monetary capability to gain more clarity on your decision.
Take all the time you need to analyze all the factors that may affect your business in the present and the future.
Planning to buy shipping containers? Contact us at BSL Containers today for any inquiries!