Mike Andes describes his early experience buying many trucks that sat unused and explains the hidden carrying costs (storage, insurance, maintenance, payments). He argues owners should prioritize utilization: if equipment is used infrequently (monthly or yearly), rent instead of buy. The clip emphasizes comparing total ownership costs, not just loan payments.
For some reason, back when I first got started, I was told by a friend of mine that had a really big business doing construction that anytime they ever had any cash laying around, they just buy more equipment. Because eventually that equipment will make you money. Here's the thing. If you don't use the equipment, it will never make you money. And so I got into this treadmill of buying a whole bunch of trucks that I never actually used very often. And I remember one day going out, I had like, 12 or 15 trucks, and like, five or six of them were just sitting there. I'm like, oh, they're burning a hole in my pocket because I have to store them, I have to insure them. And it's not just the payment if you have debt. And at. At the time, I didn't even have debt on these trucks. I also had to make sure that they maintained them. So brakes and oil changes and tires that all cost something. And so instead of buying more assets and buying more trucks and buying more equipment, focus on, am I actually utilizing it? If you're only using a piece of equipment once or twice a year, once or twice a month, I would say rent it. Don't just compare the cost of the payment versus how much you're going to. Otherwise, rent it.
