No Capital? Then why not rent
March 1st 2009 With the credit-crunch affecting investment and cash flow in business Cool Energy can offer an alternative to purchase at a time when it could be prudent to keep a hold of your cash reserves
There's more to renting than
breakdown cover says Russell Wilson,
Cool Energy's director of Rental. He
asks you to consider renting new equipment
for the long term before you choose to buy.
"We have noticed a change in the reasons
why our customers decide to rent cooling
and heating equipment rather than buy and
we want to share this with our clients.
"The majority of our customers require
hired in equipment to help bridge the gap
during a breakdown and then they either
decide to repair their kit or buy a
replacement.
"However, just like renting a building or
vehicle - financial and economic constraints
mean that some of our customers require a
more flexible approach to business and
decide to rent or lease.
"Businesses don't always consider the
alternatives to purchase or simply don't know
what is available to them.We also have a
number of customers who plan for their
future but don't know if what they buy today
will be needed in 2 years time, or will be big
enough to cope with any growth."
Flexible approach to rental
Cool Energy offer a flexible approach to
rental by providing long or short term rental
periods and either brand new – fully specified
equipment or rental fleet from a wide variety
of equipment to match the application.
We have found that a lot of our clients
have then been able to match one of our
options precisely to their own particular
business needs.
Availability of equipment and installation
is then discussed to suit the process or HVAC
application and production, which can also
be carried out during shutdowns and out of
hours to help limit any disruption to a
minimum.
Why rent?
To highlight the main benefits of our service
here is our customers top 10 list to help
clients understand what we can offer.
Top 10 reasons to rent
1) No Money – "We started a new business
making injection-moulded components, but
spent our savings on the machine.We needed
a chiller to cool the mould and hydraulics
and rented on a fixed 2-year basis to spread
the cost of the chiller.We will revisit this deal
after the 2 years and see if we can then afford
to buy the chiller or get a new one".
2) Capital Approval – "We had had a
breakdown and couldn't get capital budget
approval for 8 weeks so we rented until we
had it agreed".
3) No Capital for Trials – "We had spent our
budget but needed to trial a new product in
development.We decided to go ahead with
the project and rent the chiller we wanted,
along with the other pieces of kit. The cost of
the rental was used from our small R&D
budget".
4) Delay In Capital – "We needed extra
capacity to meet the growth in production.
We decided to rent a chiller in, so that we
didn't lose production and the goodwill with
our customers. After the project we offset the
rental cost with the extra profit from our
increased production.We then bought the
rental chiller when we had our new capital".
5) Little Money for Repairs – "Our 10 year
old chiller failed and the engineer gave us an
estimate of £6,000 to get it up and running
again or buy a new one for £14,000.We
decided to rent a chiller and scrap the old one
and not spend the little money we had to
repair. This helped us and gave us an option
that we didn't know was available.
6) Reduced Tax – "We needed a short and
long-term option because our business
required chilled storage for a 6 month
contract and a 3-year option.We didn't
realise that any rental expenditure is 100%
allowable against Corporation Tax and will
reduce what you pay. Our accountant
weighted up this and we went for the 6
month rental until we knew what our
customer needed long-term.We didn't want
to spend our capital on a chiller until we had
the commitment from our customer".
7) Cash flow – "We like rental because the
rental price remains the same so you can
budget accurately and properly plan our
outgoings.We actually pay for our rental
from our cash flow rather than paying one
large amount for a one-off purchase and earn
interest on the balance".
8) 24-Hour Maintenance Cover – "We rented
from you because the rental price included all
of the maintenance of the equipment.We
don't have to budget for repair bills".
9) Short Building's Lease – "We rented our air
conditioning rather than install a fixed system
as our lease for the building will be up in 3
years time".
10) Rental Equipment To Suit The Application
– "Cool Energy supplied the exact specification
of equipment for our requirements.We had
the latest technology for our clients' building
and this reflected well on us". The photograph
to the right shows a recent rental project,
specified to the customers exact requirements.
Cool Energy has a wide range and resource
of equipment with 100MW of rental fleet
currently available. In addition to this,
equipment can be purpose-built at Cool
Energy's own 50,000ft2 manufacturing facility
based in Southampton to suit any bespoke,
low temperature, ATEX and low profile
applications. This includes air and water
cooled HVAC chillers up to 2MW single
units, air handling units,
portable office air
conditioning and process
heaters.
"We readily offer a wide
range of cooling equipment
for our clients, so choice is
not an issue. Our main aim
is to provide a cost-effective
solution and alternative to
purchase when there are
not funds available.
I am confident that our
European business can
provide a first-class
service to a wide range of
businesses." Ends Russell. More articles from ICS Cool Energy Ltd: | 
