Australia

Cost Benefit Analysis of Rental Projection Equipment

Posted by Neil
Dec 30, 2016

Rental Projection EquipmentThe bottom line is what matters, so it must be factored in to any rental projection equipment decisions.

Every business usually has just one goal in mind; to make profit. Do not ever let anyone lie to you; the bottom line of every business is to make profit. Only charity organisations do things for free. That being said, it is clear that cost benefit analysis is a very important undertaking in every company before decisions are made; especially decisions that involve the use of money.

If we were to be honest with ourselves, 99 per cent of the decisions that are made in companies involve the use of money. Companies are usually looking for ways to minimise cost and maximise profit; they will always find ways to spend less money and benefit most from the things that they need. As a matter of fact, saving money becomes more of a priority when the things that are to be spent on are purely cost centres and not production centres.

A very good example is projection equipment. There is a reason as to why rental projection equipment has become so popular in the corporate circles. The choice to rent allows companies to save large amounts of money that they can spend on so many other activities within the company. The cost benefit analysis that is conducted here is usually very simple.

The corporate will usually need the equipment for maybe just one or two events in the entire year. They do not really use the equipment on a daily basis. The equipment only becomes necessary during functions. It thus does not make any economic sense for the company to spend lots and lots of money to buy equipment that will spend 90 per cent of the year gathering dust within the store. The cheaper and more cost-effective option is to simply rent the equipment. They will pay much less and will use the equipment for only the event they need, and then return it to the owner.

The argument will definitely be put forward that the company can buy the equipment and rent it out to other companies and basically the market out there when they are not using it. You have to understand that this will have a very unnecessary impact on the operations of that business. The core function of that business is not to rent out equipment; the company has its own core functions that it runs.

Thus, having to invest in projection equipment then starting to look for ways through which they can recoup that investment will mean that the company will have to invest time and resources on looking for a market for the equipment. This is all time and resources that could have been better spent furthering the core agenda of the company and increasing the sales and revenue. This is the main reason behind the popularity of the rental projection equipment among corporates today.

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