The million-dollar question for most businesses owners is whether they should rent a semi-trailer or invest in a new trailer. Each option has its advantages and there are several factors that come into play which you must consider before you decide. Utilizing a semi-trailer rental will be ideal in certain situations, while it will be best to buy a new trailer in other circumstances.

These are the factors that you should consider when deciding whether to use trailer leasing or buying a trailer for sale.

1. Your Business’s Cash Flow

Running a company successfully requires you to have a good mix of financial literacy and business acumen. Especially if you’re in a competitive industry like transport and logistics, you cannot afford to make poor money decisions. If you just started your company and you’re barely scratching the surface, semi-trailer rental will be the ideal and most affordable option.

Renting a 53 foot trailer is more affordable and you won’t have to sacrifice a huge portion of your working capital. When your company is young, you’ll need to have a good cash reserve to sustain operations until you break even. Hence, trailer rental will make more sense as it will help you save more money.

On the other hand, if your business has a strong cash flow, you can afford to make a big investment without affecting your operations. In that case, you’ll want to buy used trailers for sale, or new trailers for sale in Chicago. When you buy a trailer, it will be an asset to your company and you may claim certain tax advantages as the owner. In the long-term, your business will make up for the acquisition costs and you’ll start seeing returns from your semi-trailer investment.

2. How Long Do You Need the Semi-Trailer?

You may need a semi-trailer temporarily to serve an extra client, or during the peak season of your business. In such cases, a semi-trailer rental will fit the bill. Even if your business can afford to buy a new semi-trailer, it will be a liability if you only end up using it for a few months then relegating it to your parking. Particularly if you purchased your semi-trailer using a loan, you may have a negative cash flow in your business.

The good thing with trailer leasing is that it saves your business the extra expenses that come with a new trailer. You won’t have to worry about insurance costs and repair and maintenance costs because the trailer leasing company will cover these costs. Also, you won’t have to pay parking fees since you can lease the trailer for the period that you need it, and return it to the trailer rental company when no longer using it.

3. When Venturing Into a New Industry or Trying a New Product

As you scale your business, you may decide to expand into a new industry or venture into new products that require special transportation. For instance, you may decide to expand your moving business and start dealing with horticulture products. This would require you to use reefer trailers.

Instead of spending much of your capital to purchase a reefer trailer, you may lease one from a trailer rental company near you. This will reduce your operating costs and enable you to absorb risks without hurting your company’s financial standing. Any time you venture into something new, there’s always the risk of failing. With a leased trailer, if your idea doesn’t work out you can end your lease and return the trailer. Conversely, if you had bought the reefer trailer, you would be stuck with it or have to sell it at a loss, if your new venture failed.

There are about 15.5 million trucks operating in the U.S., and about two million of them are tractor trailers, of which most are owned by trailer leasing companies in Chicago and other cities. As such, there are enough semi-trailer rentals, and new and used semi-trailers for sale available for your company. Consider the above-discussed factors when deciding whether to buy or lease a semi-trailer.