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Get wise to fair wear & tear

12 October 2015

For a vast number of UK organisations, hiring or leasing their fork lift trucks makes more economic sense than buying outright. However, such businesses would be wise to consider their obligations under such a contract – it could work out very expensive indeed.

Hiring a car is pretty straightforward; you return it with a full tank of fuel and, if you didn’t purchase insurance cover for accidental damage, you must reimburse the hire company for any dents, scrapes, missing wing-mirrors, etc. Hiring a fork lift, on the other hand, is rarely so straightforward. Unexpected costs can lead to confusion and a bad taste in the mouth – which is bad for both the customer and the supplier.

The most important thing that customers should be aware of is that, in addition to contract hire fees, they are responsible for any repairs outside of normal ‘wear and tear’. Wear and tear refers to the expected deterioration of equipment that will occur during use if it has been used in accordance with the manufacturer’s guidelines. ‘Damage’, on the other hand, is caused by misuse and abuse of the equipment.

Costly mistakes
As anyone who has dented a car will know, the size of a repair bill can be eye-watering – and much more than anticipated. The same is true with forklifts but the bills can be even higher which is why companies renting fork lifts often unprepared for just how much an incident will ultimately cost them.

That’s because an impact involving a fork lift will frequently cause a knock-on effect, resulting in damage to other components. For example, damage to a truck’s bodywork could leave the hydraulic and electronic systems, housed within, exposed to dirt and moisture. This could, in turn, harm those components.

Perhaps the most commonly abused items are the seats. Of course, genuine wear and tear is to be expected but, even at the end of a 5 year contract, holes and rips are considered unacceptable damage, and will be charged accordingly. Fitting a replacement can cost hundreds of pounds.

As you can see, customers expecting to simply return their truck and collect their deposits can be in for a rude awakening – and that’s far from the worst case scenario. What if stock happens to topple onto your forklift from height? Safety-related structures, such as the overhead guard, often cannot be repaired. The cost of replacement varies between models, but in this scenario you could expect to pay several thousand pounds to fix the damage!



Let’s not forget the labour costs too. Fork lift hire companies are businesses like any other, and their service engineer’s time is valuable.

Taking precautions
There are a number of things that businesses can do to protect themselves from costly rental mistakes:

• First and foremost, it’s important that you read and understand the hire agreement before you sign it. Certainly don’t settle for a verbal agreement as that leaves you open to all sorts of problems later on.

• Upon delivery, confirm that you and the hiring company have a copy of the same handover document. You should then make a careful inspection and record any damage you spot. Before allowing it to be used, ensure your operators are aware of how to operate and look after the truck – including how to conduct and record daily or pre-shift checks. Whatever you do, do not allow untrained personnel to use it!

• Make sure trucks are regularly inspected and any faults are dealt with swiftly. Don’t neglect drips of oil and other fluids - these can be indicative of a serious issue developing. Likewise, ensure that your truck is serviced in accordance with the manufacturer’s requirements by allowing the hiring company to conduct work when necessary.

• To prevent damage, be vigilant against misuse. This includes making sure that the truck is only used in suitable areas, and that it is not overloaded. Not only is this unsafe, but it can cause serious damage. Likewise, look out for minor scratches appearing on the bodywork as these indicate careless operation – you might want to intervene before an altogether more costly accident occurs. You might want to let them know just how much truck damage could cost the company.

• Perhaps most important of all, hold routine meetings with your supplier and note the outcomes so that you have a record of what has been agreed. It may make sense to rectify damage as you go or obtain agreement that it falls within the heading of fair wear and tear. Most acrimonious fall-outs come after several years without communication, and no-one likes a nasty surprise.

Here to help
Available exclusively through its Member companies, the FLTA has produced The Fair Wear and Tear Guide. The 32-page, illustrated guide offers an unbiased explanation of ‘fair wear and tear’ in the context of fork lift truck hire. See FLTA website for details.



 
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