PRIME MOVER MAN TGX 540

Need delivery trucks for your business? Leasing and renting are the two best options for supplying your business with the trucks needed to get deliveries done on time.  Figuring out which path is best for your business isn’t as simple as it sounds. In fact, there are a lot of considerations to keep in mind, and of course, each approach has its pros and cons.

In the current economic climate, many capital expenditure (Capex) budgets have been cut. Finance or transport managers faced with these shrinking Capex allowances typically arrive at the question????:

 “Do I invest in a fleet hire company to improve my operations or do I buy new fleet vehicles?”

Both approaches have their pros and cons, but first it’s important to consider the difference between capital expenditure and operational expenditure (Opex) when it comes to fleet hire.

Capex vs Opex

A Capex fleet management solution would generally require a large, upfront purchase of vehicles, with additional maintenance charges, whereas Opex would be an all-inclusive monthly fee. A monthly service model is an Opex line item, which typically has favourable tax and budgeting advantages to Capex. While Opex will appear in your budget as an ‘operating cost’, Capex is considered as ‘equipment with depreciation’. Using profits to pay for the rental of vehicles, rather than buying vehicles that will depreciate, is an efficient way of managing your tax.

Plus, with lower upfront capital commitments, you reduce the risk of hidden costs and budget concerns over ongoing fleet hire support, vehicle maintenance and upgrades.

At Axle Hire, we can offer flexible rental solutions to suit your business, without the need for upfront capital investment. Our approach is based on looking beyond a simple list of requirements or contractual obligations and thinking carefully about how what we do supports you as a business both now and in the future. Get in touch with one of our experts to find out more.