CRANE CRITIQUE
CONSTRUCTION NEWS BULLETIN
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CRANE OPERATING COSTS A monthly crane and rigging informative column for all personnel directly or indirectly involved with crane safety. Each month we will attempt to explain a different technical issue pertaining to crane operations here on Guam, addressing the sometimes overlooked or misunderstood topics by management and operators alike. By Dave Barnhouse
This month’s topic: The very important subject of crane operation costs. As much as some will not admit it, the bottom line is coming out in the black, whether be the crane owner, lessor, or user. As far as the crane user, or contractor, the big question has always been to rent or own. This decision is usually left up to the money crunchers, as it should be, but unfortunately these decision makers are not usually the most crane knowledgeable personnel, and bad decisions are sometimes made. The rent or buy issue is a complicated one and not the purpose of this discussion, but rather to address some of the hidden operating costs a potential buyer or renter may be paying for when he operates or rents a crane. One point I would like to make clear is that cost issue is not the only factor in deciding what contractors should use for their lifting projects. I have always advised small contractors to consider renting over buying because the average contractor does not have the key personnel required for even a small boom truck operation. And yes, small boom trucks are cranes. If you are one to ask this question than perhaps you should not purchase that boom truck. So what are some of the benefits of renting? Here are a few: 1. No Depreciation 2. Modern Equipment 3. No Risk of Obsolescence 4. Little to No Maintenance Costs 5. No Warranty Costs 6. Insurance based on Job 7. Little to No Storage Cost 8. Specialized Equipment that’s Right for Your Specific Job 9. Time and Money Saved by removing the purchasing process 10. No Capital Investment 11. More Flexibility 12. Better Availability without Transportation
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Costs 13. No Burden of Selling Equipment Later This is not to mention that you and your team get to supplement your current fleet without the risks of owning or leasing. As the crane renter and user most of these costs in this list are not your concern or responsibility, right? Maybe not directly but of course you are paying all these costs indirectly with your rental fee. But let's look at some of these items more closely, as most end users do not realize the actual costs and when billed $1,500 or $2,000 for a day's work when only a few lifts were made, they feel they are being taken
advantage of. The costs most likely not realized by the crane renter are the hidden maintenance costs. If you have ever experienced sticker shock for a major repair of your automobile, try paying for a similar crane repair. Though most crane owners employ crane mechanics to maintain and perform these major repairs in-house, the end cost can be enormous. Recently during an annual inspection of a local company's hydraulic crane, for example, a small oil leak was noticed from the boom extension cylinder. It was scheduled for a repair and the parts already purchased, a total of $62,000 for the parts only. This particular boom type repair required the manufacturer's tech
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