7 Practical Ways Construction Contractors Can Reduce Equipment Costs

Equipment costs can quickly eat into your project margins. As Canada’s construction sector continues to face rising expenses with new tariffs in place, we’ve compiled these actionable strategies to help contractors manage to reduce equipment costs while maintaining quality work.

The Real Cost Challenge

Equipment expenses represent approximately 20-40% of project costs for Professional Toronto construction contractors. With steel prices up 15% over the last year and supply chain issues still affecting equipment availability, managing these expenses is more critical than ever.

1. Match Equipment Size to Project Requirements

Using oversized equipment bleeds  money through higher rental rates, increased fuel consumption, and potential site damage. For instance:

• A standard backhoe rental costs approximately $350/day versus $175/day for a mini excavator
• Fuel consumption can differ by 5-7 gallons per day between properly sized and oversized equipment
• Site restoration from oversized equipment damage averages $1,200-2,500 per project

Before securing equipment, assess job specifications including excavation depth, material volume, site access constraints, and timeline requirements. NAM RENTALS provides detailed equipment specifications and our team can help determine the most cost-effective option for your specific needs.

Need guidance on equipment sizing? NAM RENTALS offers complimentary project assessments to recommend appropriate equipment options.

2. Consider the NAM RENTAL Advantage

Equipment ownership costs extend far beyond the purchase price:

• Annual maintenance typically runs 8-15% of purchase price
• Insurance averages 2-5% of equipment value annually
• Storage costs range from $150-400 monthly in the GTA
• Depreciation reduces asset value by 15-25% in the first year alone

NAM RENTALS provides top-tier regularly maintained  equipment without these ongoing expenses. Our monthly rates typically work out to 2-4% of equipment purchase price, significantly reducing your capital expenditure while ensuring access to properly maintained machinery.

For specialized equipment used less than 60% of the time, renting is demonstrably more economical than ownership. NAM RENTALS fleet includes everything from basic earthmoving equipment in Toronto to specialized concrete handling tools.

NAM RENTALS rental calculator can show you exact cost comparisons between renting and owning based on your usage patterns.

3. Implement Equipment Tracking Systems

Equipment tracking software prevents costly duplications and underutilization:

• Construction equipment utilization rates average just 30-40% without proper tracking
• 15-20% of rental costs typically result from equipment retained after project completion
• Jobsite theft and misplacement account for equipment losses averaging $5,000-10,000 annually per contractor

NAM RENTALS equipment tracking platform is available to all customers at no additional cost with documentation on implementation and training provided.

4. Prioritize Preventive Maintenance

Equipment failures create cascading costs beyond repairs:

• Average downtime cost: $500-800 per hour for idle crews
• Emergency repair premiums: 40-60% higher than scheduled maintenance
• Rush delivery fees for replacement equipment: $250-500 per incident
• Schedule delays: potential contractual penalties averaging $1,000+ per day

NAM RENTALS maintains all equipment to manufacturer specifications. Their preventive maintenance program includes:

• Pre-delivery 27-point inspections
• Fluid analysis at 250-hour intervals
• Component replacement based on manufacturer guidelines rather than failure
• Complete maintenance history documentation

NAM RENTAL provides 24/7 emergency service with average response times under 3 hours across the GTA so that your projects don’t come to a halt in case of a breakdown.

5. Invest in Operator Training

Proper equipment operation directly impacts your bottom line:

• Trained operators complete tasks 15-30% faster than untrained personnel
• Fuel consumption decreases by 10-20% with proper operation techniques
• Maintenance issues from improper operation drop by approximately 40%
• Accident rates decrease by 50-70% with comprehensive training

NAM RENTALS offers equipment-specific training programs ranging from basic operation to advanced techniques. Their certified instructors provide both classroom and hands-on training tailored to your team’s experience level.

NAM RENTALS operator certification programs meet all Ministry of Labour requirements and include documentation for your safety records.

6. Optimize Equipment Scheduling

Strategic scheduling eliminates costly inefficiencies:

• Equipment idle time costs Toronto contractors approximately $8-12 million annually
• Average rental utilization without proper scheduling: 4-6 hours per 8-hour day
• Mobilization/demobilization costs per equipment piece: $350-700
• Weekend charges for unused equipment: $200-350 per day

NAM RENTALS works with your project timeline to minimize these expenses through:

• Flexible delivery and pickup scheduling including same-day service
• Half-day rates for short-duration needs
• Weekend rate reductions for ongoing rentals
• Multi-site equipment sharing options

NAM RENTALS scheduling team can review your project timeline and identify specific opportunities to reduce equipment costs through optimal scheduling.

7. Develop Strategic Supplier Relationships

Transactional equipment rental relationships cost more than partnerships:

• Standard rental rates vs. preferred customer rates: 12-18% difference
• Emergency availability premium: 25-40% for non-regular customers
• Payment terms flexibility: net-30 vs. COD (improving cash flow by 3-4 weeks)
• Average savings from bundled services: 8-15% on total equipment costs

NAM RENTALS offers a contractor partnership program that provides:

• Volume-based pricing tiers
• Priority access to high-demand equipment
• Extended payment terms for qualified accounts
• Dedicated account management
• Quarterly rental analysis and optimization recommendations

NAM RENTALS contractor program requires no minimum spend commitment and is structured around your specific equipment needs.

Taking Action

Equipment costs directly impact your competitive position in Toronto’s construction contract market. The difference between average and optimized equipment expenses typically represents 6-9% of total project costs—often the difference between winning bids and profitable execution.

NAM RENTALS specializes in helping Toronto contractors implement these cost-saving strategies through their comprehensive equipment solutions. Their experienced team can analyze your current equipment utilization and identify specific savings opportunities.

Contact NAM RENTALS for a no-obligation equipment cost assessment. We’ll provide concrete recommendations for reducing your equipment expenses without compromising project quality or timelines. 

To Book, Call us at: 647-525-7368