Increasingly customers who use packaging rental systems such as Chep are realising that they are paying in rent the purchase price equivalent for their folding intermediate bulk containers every two to three years.
Where the units are transported distances between different companies this cost is offset by the obvious value added that these hire companies offer in terms of relocation. However, where the units are permanent warehouse storage on-site, are transported between company sites, or are in controlled closed loops – effectively on permanent rental – there are significant savings that can be made.
IBC Solutions offers Rent to Buy options on its range of folding packaging containers. Typically, these are set up over a three year period. Customers enter into a term rental agreement, and at the same time an agreement is made as to a purchase price for the containers at the end of the period, should the customer wish to purchase at that point in time; there is no obligation to do so, and the containers can be returned, or a further term rental can be entered into.
“Our intention is always to provide an alternative to companies who are permanently renting, rather than to compete in the rental market, so we eventually want the customer to buy the units” states Nigel Smalls, CEO of IBC Solutions.
One of the important elements of moving to a Rent to Buy is ‘seamless change’ and this can be achieved by selecting the appropriate container equivalent. IBC Solutions has a wide range of units as alternatives to various hire company units.
Rent to Buy can be structured to suit an individual company. “Some companies decide that making operational savings up front is important with a lower rental rate so they pay a little more to buy the units at the end; others decide basically to buy the units during the rental period, with only a low purchase price at the end – we can structure to suit” offers Nigel.
Rent to Buy is an option to lease financing or outright purchase and will not be suitable to all companies. It does represent a huge opportunity for customers, with immediate operational savings on rental costs of 25 – 50% possible. And the best bit is you get brand new containers that will last for years.