What is Container Leasing?

Malcolm Tatum
Malcolm Tatum

Containers are large shipping devices that can be utilized on land and on sea with equal ease. The uniform shape and dimensions of containers makes it very easy to secure the devices to a flatbed trailer or rail car and move goods across highway or rail systems. Containers can also be stacked and secured in place on barges, making them ideal for water transport. While some companies choose to purchase containers, others find that container leasing is more practical and cost-effective.

Containers are large shipping devices that can be utilized on both land and sea.
Containers are large shipping devices that can be utilized on both land and sea.

Container leasing involves entering into a working agreement with a container supplier. The supplier agrees to deliver a minimum number of containers to the client, with the understanding that the containers will be used for a specified time and at a rate documented within the terms of the lease agreement. Both the supplier and the customer will also agree to other terms and conditions required by applicable laws, and any other negotiations made between the two entities.

Containers are typically used on rail lines.
Containers are typically used on rail lines.

One of the main benefits to container leasing is the flexibility that is often built into the lease agreement. Often, suppliers and clients agree upon a minimum number of containers to be in the possession of the client for the duration of the lease. However, additional containers can be requested and delivered for use when and as the customer needs them. It is not unusual for discount leasing fees to be applied to those extra containers. As a result, the customer only keeps what is needed on hand, but has immediate access to additional containers with only minimal expense involved.

Companies also find that a container leasing arrangement helps to eliminate the need for upkeep on the containers themselves. While customers are expected to take reasonable care of the containers, most container leasing companies realize that normal wear and tear does take place. Customers can turn in older containers for newer ones from time to time, often without any changes to the terms of the leasing agreement.

It is not unusual for a container lease to provide customers access to more than one type of container for shipping purposes. A given contract may establish the ability of the client to enjoy tank container leasing privileges along with the standard storage container lease that is common for units constructed for use with dry goods. This arrangement tends to work well for companies that import and export goods from various continents, or that sell both solid and liquid goods.

Providers sometimes include provisions in their container leasing agreements that make it possible for customers to receive discounted pricing should they choose to purchase a minimum number of units. This provision is helpful for companies going through an expansion that makes it more feasible for the business to own and operate their own transportation network rather than outsource those functions. Often, the cost per unit is significantly less than purchasing containers from a new vendor.

Because there are advantages to container leasing as well as container ownership, companies may require some assistance in determining which option is in the best interests of the company. A reputable container sales and leasing company can help business owners evaluate their needs and decide if purchasing containers would be a better approach than container leasing.

Malcolm Tatum
Malcolm Tatum

After many years in the teleconferencing industry, Michael decided to embrace his passion for trivia, research, and writing by becoming a full-time freelance writer. Since then, he has contributed articles to a variety of print and online publications, including wiseGEEK, and his work has also appeared in poetry collections, devotional anthologies, and several newspapers. Malcolm’s other interests include collecting vinyl records, minor league baseball, and cycling.

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Discussion Comments

anon967737

The article provides valuable information and insight for customers how to take lease of containers to suit the best interests of his business/purpose. Thanks.

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