Excavators hire is commonly known as Plant hire. Excavators hire implies to, providing machinery, tools and other equipment, irrespective of size and power to service sectors for a limited period of time. Excavators hire is basically opted by construction contractors.
This rental service was at first developed by the Anglo-Saxon countries around the 1950s which later on caught up with the rest of the world. It was at first, a family possessed small business but now this concept has changed to international firms and groups.
The basic reason to this drastic improvement of Excavators hire sector in such a short duration of time would be:
- Capital: Excavators hire services help contractors and other service users to reduce the capital required for their purpose. If these services were not available, then these contractors etc have to invest a very huge amount in the equipments required part of the capital. Also the maintenance and other formalities included for these equipments would be extra. But with this service, these contractors have to only invest for the rental purpose thereby reducing the cost drastically.
- Latest equipments available: As in any sector, there is tight competition in Excavators hire sector too. To win a contractor, they need to provide them with latest machinery and equipments at a reasonable price. Due to this reason, the service users can ensure the availability of latest equipments for the service.
- Maintenance and other formality: Equipments, machineries and tools come with a package. Their maintenance cost gulps up around half of its cost and other timely check ups and formalities to ensure the safety of the users are other head ache to be followed. If not Excavators hire service provider, it would be only a burden to the contractor in addition to the work he does. If Excavators hire service provider, they just have to concentrate on the machineries as their work revolves around this and so the contractor is assured of the safety check and other formalities required for the work.
The basic principle of this sector is that the rents provided must slowly though but cover the cost of the plant, thereby slowly earning profits too. When viewed from this point of view small plant providers provide more profit as the basic investment is less and earning would be easier. Also, small plants will be demanded more than huger plants as once the rent would be much lower and so would be the requirement. Huge plants are usually demanded by huge contractors who can afford the rent, which are comparatively lesser to ordinary companies or contractors requiring Excavators hire service.
There are basically 3 scenarios into this field:
- Buy new plants, meet all its extra expenses besides the earning it earns and then after years of utilization sale it off.
- The second scenario is to buy used plants and do maintenance of it which would be quite high and after utilization of it sale it off.
- The final scenario is to buy brand new plants use it for the plants use it for a short period of time which in return gives less maintenance cost and the sale rate also increases.
Most small scale Excavators hire service providers follow the third scenario to earn profits in short duration of time. Also natural factors must be noted while stating such a service business because if the plant hire service provides agricultural machinery and equipment, there would be season when the equipment has to be booked months before utilisation and seasons when seasons where certain machinery are not utilised at all. Where as in construction related sectors all machinery are used almost at all times even though certain seasons would slow down the demand.