Construction tools and equipment are an essential part of an electrical contractor’s business and can represent a significant investment. In addition to the large initial investment and the provision for eventual replacement, expenditures must be made for maintenance and repair, storage and handling, insurance, taxes and interest. As with any other investment, a contractor must also seek a return on the investment he makes in tools and equipment.
The rates contained in this publication may be useful as a guide for either internal estimating and cost accounting or for quoting prices to customers. NECA has always recommended that the cost of tools and equipment be included in the estimate as direct job expenses and not as a part of general overhead or operating expenses. In accordance with the standard definition, tool and equipment expense is a part of the direct job expense.
What’s new to the Tool & Equipment Rental Schedule?
The 2017-2018 Edition of the Tool & Equipment Rental Schedule includes updated list prices for all items. For smaller equipment and tools, changes in list price were the most significant, while for larger equipment types, comparisons to third party rental rates, and first-principal analysis had a greater influence on rates.
What’s included in the Tool & Equipment Rental Schedule?
These rates include an average allowance for depreciation, shop maintenance and repairs, storage, handling, insurance, taxes, interest and a reasonable return on investment.
What’s Not Included?
The rates do not include the cost of operators, fuel or electricity. There is no allowance included for delivery and pick-up nor for field repairs other than routine maintenance such as lubricating or adjusting.
Basis of Rates
The rates in this schedule are based upon average initial purchase prices, ownership expenses and use periods. The experience records and schedules of individual electrical contractors as well as the schedules and practices of equipment rental dealers were reviewed. The rates are necessarily averages and based on average costs and normal use.
How to Use the Rates
These rates are based upon the contractor furnishing the complete tools and equipment for an entire job. They are not intended for casual rentals. Equipment rates are shown on a daily, weekly, and monthly basis.