© Copyright Acquisition International 2025 - All Rights Reserved.

Article Image - 5 Essentials Of An Effective Equipment Budget
Posted 27th March 2023

5 Essentials Of An Effective Equipment Budget

Are you a business owner planning to invest in equipment for efficient service and product delivery to your clients? What plans do you have in place to actualize the dream?

Mouse Scroll AnimationScroll to keep reading

Let us help promote your business to a wider following.

5 Essentials Of An Effective Equipment Budget

Are you a business owner planning to invest in equipment for efficient service and product delivery to your clients? What plans do you have in place to actualize the dream? It’s important to plan all aspects of the investment, from storage to finances.

‘Failing to plan is planning to fail’ is an adage that’s been used since time immemorial. With this in mind comes the need for financial planning. A budget is one of the solutions to the financial planning of your equipment investment. It guides on the limit of your expenditure on the equipment.

How do you create an effective equipment budget? Here are some of the essentials of the budget:

1. Purchasing Price

As the name suggests, it’s the amount you’ll pay to acquire the equipment. This figure depends on various aspects which you should consider. One is the vendor from whom you’ll buy the equipment. Vendors will sell similar equipment at different prices. Hence, as you budget for equipment, it’d help to compare the prices of several vendors. Seek one with affordable prices.

The other aspect to consider is the model of the equipment you’ll buy. Some models are more expensive than others, often due to the equipment’s features. The more features and technology in place, the higher the purchasing price.

Consider the above aspects as you add the purchasing price to your budget. It’ll ensure you don’t set a small budget to buy your equipment. Suppose you don’t have enough money to meet the equipment’s purchasing costs. Worry not as you can get full service asset financing services. Find the appropriate provider for these services.

2. Fuel Costs

Fuel is a must-have for your equipment after purchasing it. As you add fuel costs to your budget, it’s important to acknowledge that different pieces of equipment use different fuels. Some use petrol while others use diesel. It’s important to know the fuel your equipment will use while budgeting. It’ll help you land averagely accurate figures on fuel expenses. You don’t want to park your vehicle five months into buying it due to a lack of funds to fuel it.

It’d help to find the average costs of your fuel for approximately seven to eight months. You can get this figure by identifying the miles the equipment will cover in a week. Find out how many liters it’ll consume in those miles and multiply the figure by the current price of fuel, whether diesel or fuel. Consider adding a few figures to the final costs to cater to any fuel influx.

3. Labour Costs

Unless you plan to operate your equipment independently, you must add labor costs to your effective equipment budget. These costs will cater to the hiring and training of the equipment operator. It’d help to identify the specific skills you require from the operator and gauge how much such skillsets will cost.

Also, find out the costs of the various training sessions and add them to the labor costs. With the goal being affordability, consider negotiating the salary of the operator. All you need to do is ensure you don’t exceed the labor budget and don’t compromise on quality services for cheap costs.

4. Servicing Costs

While using your equipment, it’ll likely deteriorate and need tuning up. Tuning up ensures the equipment is in optimum condition to meet your needs.

When planning to buy equipment, servicing cost is something most people forget. Yes, you won’t incur these costs instantly, but you will eventually. Hence, include them in your budget. How do you find a close-to-accurate figure for servicing costs?

The servicing needs of a trailer are different from those of an excavator. List the servicing activities of your chosen equipment model. These include filter and oil changes, wheel alignments, and brake inspections.

A mechanic or an online source can provide this information. It’s information most businesses learn about before buying equipment. Therefore, proceed to find out the costs of each activity and sum it all up to get the figure.

5. Repair Costs

Constant use of the equipment upon purchase increases wear and tear. It’s likely to break down here and there and will need repairs. When purchasing equipment, you hope it’ll serve you for the longest time without issues. However, it’s not always the situation on the ground. It’s best to add it to your equipment budget.

Like with servicing costs, find out the common repair needs of your chosen equipment. It’ll help you arrive at a close-to-accurate figure. Since you won’t necessarily do all the repairs as you use the equipment, only add half or three-quarters of the figure you get to your budget. Doing so prevents financial burden.

Conclusion

Creating an effective budget for your equipment isn’t as challenging as you might have imagined. The discussion above proves this.

All you must do is know what you’ll spend on the equipment, from when you buy it to when you dispose of it, should the need arise. The insight herein guides on doing this. Therefore, consider implementing it along the financial aspect of your equipment investment.

Categories: Finance


You Might Also Like
Read Full PostRead - Eye Icon
2016’s Most Innovative Company – Kenya
Strategy
31/07/20162016’s Most Innovative Company – Kenya

Formed in 1998, Miller & Company Advocates comprises a team of highly qualified, energetic and dynamic professionals who represent the new face of legal practice that is in tune with today’s business trends and modern client needs.

Read Full PostRead - Eye Icon
In Profile – Saikrishna & Associates
Legal
01/07/2016In Profile – Saikrishna & Associates

Based in Uttar Pradesh, India, Saikrishna & Associates is a highly renowned independent IP law practice, who over the years have continued to grow and expand their services. We profiled them to put the spotlight on their success.

Read Full PostRead - Eye Icon
New research shows 88% of businesses trading internationally haven’t looked at switching their supply chains pre-Brexit
Strategy
07/12/2020New research shows 88% of businesses trading internationally haven’t looked at switching their supply chains pre-Brexit

With less than 30 days to go until the UK leaves the EU, it’s vital that businesses get ready for the transition that will take place.

Read Full PostRead - Eye Icon
Air Liquide’s Acquisition of Airgas on Track
Strategy
26/01/2016Air Liquide’s Acquisition of Airgas on Track

Air Liquide, world leader in gases, technologies and services for Industry and Health, and Airgas the leading supplier of packaged gases and associated products and services in the United States, announce the date of the special meeting of Airgas’ shareholde

Read Full PostRead - Eye Icon
Intellectual Property: Protecting and Realising the Value of Intangible Assets
Leadership
07/12/2015Intellectual Property: Protecting and Realising the Value of Intangible Assets

M. Uzcátegui & Asociados is a professional company founded by Dr. Mariano Uzcátegui Urdaneta and Dr. Rafael Pizani in 1955 under the name of Escritorio Pizani. Leonardo E. Uzcategui L. talks us through the firm and their work.

Read Full PostRead - Eye Icon
Payday Loans vs. Personal Loans: Seven Differences
Finance
16/11/2021Payday Loans vs. Personal Loans: Seven Differences

Payday loans or personal loans could be your place of refuge when you get into an emergency need. They are an excellent way since the application and disbursal don't take long.

Read Full PostRead - Eye Icon
Siemens Acquisition of Magazino from HTGF
Finance
23/07/2015Siemens Acquisition of Magazino from HTGF

Siemens Acquisition of Magazino from HTGF

Read Full PostRead - Eye Icon
Cloud Pioneer Liaison Technologies Launches Industry’s First dPaaS
Innovation
02/04/2015Cloud Pioneer Liaison Technologies Launches Industry’s First dPaaS

Liaison Technologies, the industry-recognized leader in cloud-based integration and data management offerings, today announced the availability of the Liaison Alloy Platform™, the industry's first dPaaS (Data Platform as a Service) solution.

Read Full PostRead - Eye Icon
People, Not Packages
Leadership
03/01/2018People, Not Packages

ICON Relocation have one of the most experienced management teams in the industry, with over 100 years of management experience in the relocation sector.



Our Trusted Brands

Acquisition International is a flagship brand of AI Global Media. AI Global Media is a B2B enterprise and are committed to creating engaging content allowing businesses to market their services to a larger global audience. We have a number of unique brands, each of which serves a specific industry or region. Each brand covers the latest news in its sector and publishes a digital magazine and newsletter which is read by a global audience.

Arrow