Answer is B: When to replace equipment and what age should your fleet be is always a question being asked. One of the key measurements in running a rental operation is to look at repair and maintenance expense. This should be done on an ongoing and periodic basis, looking at each individual piece of equipment in your rental fleet, different categories and classes of equipment and the fleet as a whole.

The RentalAdvisor looks at 13 criteria when replacing equipment. The first thing to look at is repairs and maintenance expense. Generally speaking, if repair and maintenance expense (over a 12 month rolling period or on an annual basis) is greater than 10% of the rental revenue of a piece of equipment, that equipment should be flagged for disposal, trade in, etc.

If you answered “A” or “D” you need to drill down on this metric and pay attention or repairs and maintenance will eat up your profits (and may hurt business because of old equipment that is not very reliable).