If you are considering introducing additional space for your company, naturally you wonder whether you should buy a temporary building or if hiring one is the better option. Of the three different types of buildings we offer, two are available for hire.
1. Our relocatable (temporary) buildings with a PVC fabric roof and steel wall-cladding, are available in as little as 7-21 days from order in a massive range of sizes, and are suitable for basic weather cover.
2. Our relocatable (Semi-permanent) interim buildings have a 40mm insulated steel roof and 40mm insulated steel wall cladding, and are far more suited to environments where people are working and heating and cooling are to be used, due to the insulation properties of the roof and wall cladding
Our permanent steel buildings which have warranties for up to 30 years are available for outright purchase only.
To Buy Or Hire?
Every client has a different mix of applications for the building, expected duration of use, requirements beyond that term such as potential re-use, financial and budgetary constraints and so on. That means each may be better suited by either the purchase or hire options – which is why we offer both.
Obviously, hiring is by far the preferred option for a short-term one-off requirement. You want it on-site and in place on time, use it for the period you need it, and then have it removed. Job done. But there are many variations on short term requirements and the best laid plans do frequently and unexpectedly change.
Outright Purchase Pros & Cons
- Asset on balance sheet – The building is yours, whether it has been financed through a mortgage or some similar arrangement, or paid for outright. It is a capital expenditure and goes on the books as such.
- Depreciation potential – As with any asset, you can claim depreciation each year as advised by your accountant, which adds to the bottom line P&L numbers.
- Can be re-used – After its initial purpose has run its course, the building can be quickly taken down and moved to another location if required, or put into storage (which need not be indoors). You can do it yourself or ask us for a quote to do the entire task for you. These costs are now usually OpEx rather than CapEx, which generally require a lower level of authorisation, permitting greater local flexibility and autonomy in larger companies.
- Can be liquidated – We supply the buildings with a guaranteed buy-back option subject to reasonable wear and tear. That means you can exchange the asset for a capital injection at any time that suits you or if your medium term plans change.
- Not a short term option – Probably the only significant downside of outright purchase is if your plans change early in the planned period of usage. Even with our buy-back option, there would be an unavoidable cost.
You may find this case study interesting – a company who found that purchase rather than hire was the most cost effective solution for their particular circumstances.
Hiring Pros & Cons
- Fixed cost – You know the exact monthly overhead in advance
- Not a capital expenditure – Sometimes obtaining authorisation for an acquisition can be a prolonged process with no guarantee of approval. Hiring bypasses that requirement in the majority of cases, with only local management approval needed for the operating expense.
- No maintenance – When you hire a building, we are responsible for maintaining the building, not you. You only have to provide adequate buildings insurance which is usually a mere formality when added to your existing policy
- Flexibility of term – We don’t tie you into a pre-determined or minimum-term contract. You are totally free to extend the use on a month to month basis for as long as you want. All we ask is 7 days’ notice when you want us to take it away.
Not a long term option – For a longer usage period, hiring does work out more expensive than outright purchase and this is an unavoidable fact of hiring in general. It is designed to be a short term solution. However, this can be balanced somewhat by also representing a fixed monthly overhead that makes it predictable and, of course, it can be terminated at any time with just 7 days’ notice.
To Sum Up
This is just a simple and quick high-level appraisal of the two options which highlights the major points. You may well be able to add your own rationale to either option. Please feel free to call us on 01827 330 000 if you have any questions, and we will happily talk over the options and give you the benefit of our honest, open and friendly advice.
You may also download our FREE Which Building Guide for more information about your various options.