UAE is a growing economy which provides a lot of extensive opportunities for growth and development. One such is tourism, which has positively impacted the hospitality industry leading to the rise in construction activities across UAE in the recent times.
According to the research conducted by MarkNtel Advisory, the UAE Construction Equipment Rental Market is projected to grow at a CAGR of less than 5% during the forecast period, i.e., 2022-27. The market is expected to rise because construction activity requires high ownership costs, machinery and plants which involves huge capital. Thus, renting construction equipment is a smart and reliable way for businesses to flourish in the market.
Benefits of Renting Construction equipment:
- Avoid the Initial Purchase Cost-
Purchasing new equipment involves huge capital investment. Thus, Renting equipment is cost-effective for the business in the long run.
- Less Maintenance and Repair Costs-
Not only the initial investment, but the equipment also has massive maintenance and repair costs. Maintenance and repair costs are less in rental pieces of equipment compared to owning one.
- Market Fluctuation:
The market is always fluctuating and dynamic. So, owning equipment involves risk, especially in a time of continuous technological upgradation. So, renting equipment reduces the risk of future unpredictability and uncertainty for your business.
- No Depreciation Costs:
Equipment involves huge depreciation costs and companies often incur huge depreciation cost year after year. Renting the equipment helps in balancing your funds and to allocate them in the best possible way.
- Project-Specific Rentals:
This is one of the major highlights of renting the equipment as you only have to pay project-specific rentals which is cost-effective and helps in the proper planning of resources.
A quick market Insight:
- The increasing focus on infrastructural development in line with UAE Vision 2030 has drastically increased the demand for construction rental equipment. UAE as an economy is growing at a rapid pace and even the government is also playing a major role in the overall development of the economy.
- Rapid advancements in technology have surged the demand in the market. As construction involves heavy machinery, the latest technology involves huge capital outflow from the business. Thus, renting becomes a reliable option for businesses.
- UAE Government plays a crucial role in the development of the construction equipment rental market. The government has introduced a new initiative; set Vision 2030 which is leading to the development of highways, shopping malls, hotels and others.
Thus, in an approach to attract better tourism the government is paying attention to the construction as well as the overall development of the economy which drives market growth.
Possible restraint:
The market is witnessing fluctuation in the rents which can disrupt the supply chain systems and growth of the UAE. The growing number of projects, demand & Supply gaps can hinder the growth of the market and put investors' money at stake. Also, the expenses associated with pick and delivery of the equipment are very high and can affect the overall market growth.
Final Thoughts:
There are a lot of benefits to renting construction equipment and one of them is cost-effectiveness. Nobody can deny the fact that the market is growing rapidly and is expected to rise in the future. The market is providing lucrative opportunities for investors to grow and propel during the forecast period.
Source-https://www.marknteladvisors.com/query/request-sample/uae-construction-equipment-rental-market.html