Absolutely. One of the biggest mistakes contractors make is not charging for equipment they own.
Once equipment no longer has any payments, it doesn't show up as a 'cost' anymore on the books. When it stops showing up as a cost, many contractors fail to charge for it.
The consequences are predictably terrible.
- You are giving away one of your biggest assets to people you barely know! (your customers)
- Your profits are paying for the fuel, repairs, etc. incurred in operating the equipment
- You are not recovering any money to replace the equipment when its run out of useful life.
This results in equipment that gets old, breaks down often, causes all kinds of wasted hours and inefficiency and worst of all, the contractor is often stuck with this older equipment because they don't have the cash-on-hand to replace the equipment without payments.
It's essential that you include equipment recovery costs in your budget to ensure your customers are paying for the use of your equipment, and that you can afford to equip your crews with the most efficient vehicles and equipment for the job.