Buying vs. Renting

As we look to the 2017 event marketing season, at some point we will be faced with a seemingly simple question regarding the equipment and assets we use: Is it better to invest in an asset to own or does it make more sense to rent? Like almost everything in our industry, the answer is…it depends.

No matter the asset, there are likely ten companies out there that will rent it to you, and just as many that can sell you a customized one. And while every situation is different, there are some factors to consider to keep what seemed like a cheap and easy decision from turning into an expensive headache.

HERE ARE SOME QUESTIONS TO CONSIDER BEFORE YOU COMMIT:

What are your goals for the asset?
Whether it’s a customized tractor-trailer, a new touch-screen monitor or an inflatable display, you’ve got to have a plan. Is the asset going to be the centerpiece of your whole event or just the coolest new gadget that will set your build apart from everyone else? It can be easy to become too focused on one small piece of a much larger footprint and end up spending way too much of an already tight budget on something that will not provide a strong enough ‘return on experience’ (R.O.E.).

It’s always fun to have the coolest new thing, but does it really elevate the overall experience enough to warrant the purchase cost? It very well may, and in that case, buy the coolest one you can find. But if it isn’t, take a look at less expensive rental options, you may be surprised at what is out there.

What is your plan for it once your event is over?
This is something that is often overlooked. Let’s say you have decided to join the ranks of brands activating with converted shipping containers. You have worked with your team to price out the rent vs. buy options and have decided to make the capital investment and purchase something that will serve not only your immediate needs but also has the versatility and durability to be altered or up-fitted for future campaigns.

Often, the initial rent vs. buy costs seems comparable, so conventional wisdom would push one to buy it and then you can reuse it for future events. In some cases, this is absolutely a reasonable assumption and may be the best course.

That being said, the beauty of renting is that once your event/tour is over, the asset simply goes away. No storage costs, no need to worry about security, insurance, maintenance, DOT records or the creatures that will inevitably find their way inside while your trailer sits in the parking lot through the winter.

Technology offers some of the similar scenarios. What is your plan for next year when that brand new OLED TV screen you just bought is obsolete and you are back in the same position? You will also need to consider building custom road cases to protect your investment.

Again, each situation is different and what works for one may not work for another.

What happens when it breaks?
Because eventually, it will. No matter how much you spend or how well you take care of it, sooner or later it’s going to break or malfunction and there’s a pretty good chance that it’s not going to blow up while you’re doing your pre-event testing at the warehouse. If you own it, you should know how to fix it and I hope that you brought a spare, or spare parts in the case of a custom or one-off piece.

On the other side of that coin, because you own it, you are the expert and you know it inside and out. No need to worry about having techs on call, excess crew, etc.

If you chose to rent, then your solution is decidedly different…Get the rental company on the phone and they can deal with it. This is one of the great benefits of renting your gear or assets. You are paying them to be the experts, to have spares, parts or an easy fix. Most notably, the burden of a solution is on them. You can’t be the expert on everything. Know what you know, and more importantly, know what you don’t know.

What are the ongoing costs?
Finally, you will want to consider the up front and residual costs associated with any new asset purchase. This will obviously vary greatly depending on what it is, but most expenses will fall into three categories; legal, maintenance and management.

As an example, I will use the converted shipping container referenced above.

  • Legal: You will need to have insurance to cover this asset to protect yourself in the event that something goes wrong. Additionally, as this is a commercial vehicle, you will need to insure and register the tow vehicle and trailer used to transport it and maintain the DOT records as well, not to mention the driver’s files.
  • Maintenance: The asset itself as well as the trailer and tow vehicle will all need to be maintained, so plan for routine oil changes, truck and trailer tires and regular brake service in addition to being prepared for the inevitable larger issues. A converted shipping container typically will be hydraulically operated and be packed with electronics (depending on your particular program), so all of those parts and pieces will require regular attention too. You will also need to account for a secure place to park/store your assets as they will be a target for theft and damage.
  • Management: Depending on how many vehicles you have, someone will need to manage all of that maintenance and paperwork and with state and national regulations frequently changing, this can be a substantial job.

Again, all of this is dependent on what the asset is and the implications will vary drastically across the spectrum of event materials. Much of the above obviously wouldn’t apply to a monitor or sound system, but the three categories are a good place to start. Your speakers will still need to be covered under your insurance policy, they will still need to be stored and maintained and someone will need to be in charge of them. Renting your equipment will typically eliminate a good portion of this, but you have to assume that those costs are going to be rolled into the rental fee.

It doesn’t really matter if it’s the centerpiece of your footprint or just one screen in your array. There are myriad factors to take into account when making these decisions and a near endless amount of options at your disposal.

BUT WHEN THE DOORS OPEN, IT HAS TO WORK. SO TAKE THE TIME, SPEND THE MONEY AND DO IT RIGHT.