How to purchase your new forklift – Buy, Rent or Lease?

It’s a question that comes up a lot. Buy, rent or lease your new forklift. Each approach offers specific advantages and disadvantages. It comes down to what is right for the forklift purchaser and what is appropriate for the price and model being purchased. This is a summary of the available options that will hopefully help you to make the decision that is right for your business.

Buying a Forklift

The simplest and most popular method of purchasing a forklift. You choose your unit, give the dealer a cheque and they deliver your new unit. Appeals to many people, particularly those with no business credit rating. For many lower priced units it is the only feasible purchasing method, most lenders will not lease anything but a brand new forklift, even if purchased from a reputable dealer.

Pros Cons
Cheaper overall than rental or lease The buyer is responsible for all upkeep and repairs (excepting warranty work
Easier purchase – less paperwork and no need to have a good credit rating Not as good for business tax purposes
No ongoing lease expense Purchase must be made in one lump sum
You can resell your forklift at any time easily If your needs change you can’t return it to the dealer and swap for another unit

Forklift Rental

Great for short periods of usage, renting a used forklift is the preferred method for large companies who want to spread out their expenses over a long period, and also the best way to obtain a modern, fully equipped forklift without a large capital expense or financing, which may not be feasible for small businesses.

Pros Cons
No upfront cost Continual ongoing expense, higher than lease payments
No maintenance expenses Operator is responsible for any damage
Option to switch to another forklift when your requirements change Rental company can withdraw your contract at any time
Easy to add to monthly bills Will never be ‘paid off’, continual ongoing expense
Can be returned if no longer required Unable to recover sunk costs by reselling

Forklift Leasing

Leasing is the third way to purchase a forklift. It’s less common than buying or rental, because it’s usually only available for new forklifts, and thus is typically a dealer supplied option. The main advantages are the same as leasing a car, a fixed repayment over several years, with the option of a renewal on a new unit or a balloon payment on completion.
While very desirable for tax purposes, leasing is not for every business as it requires you to have good credit and be able to afford the lease on a new forklift, which is something that you may not require.

Pros Cons
No upfront cost Large balloon payment at the end of lease
Can return forklift at end of lease and replace with a smaller or larger unit Responsible for al maintenance and upkeep of forklift
The cheapest way to obtain a brand new forklift Only available on new forklifts, not used forklifts
Cheaper than forklift rental Must have good credit

We hope that this article on purchasing methods for new forklifts and used forklifts is helpful to you when making your purchasing decision. Remember to check out our used forklifts, and our new YMA Forklift range as well. Don’t forget we are just a phone call or email away, even if you end up purchasing elsewhere, give us a call to compare models and pricing, or for advice on unit selection.