Trucking: Lease or Buy?

Eldon E. Brooks and James R. Jacks

No 314654, Farmer Cooperative Research Report (FCRR) from United States Department of Agriculture, Economic Research Service

Abstract: Report Preface: A major farmer cooperative decided to lease trucks operating out of its forward distribution centers, but it also decided to own the trucks operating from its central base. Another cooperative decided to lease, because it helped improve the cooperative’s debt-equity ratio; still another leased because of investment tax credit sharing with the leasing company. On the other hand, a cooperative decided not to lease, because it was more economical to buy. Why these diverse courses of action recently on leasing of transportation equipment? The answer to this question is that for each situation the deciding criteria are different. To provide guidelines for making the lease or buy decision, Farmer Cooperative Service examined research literature, case studies, and cash flow studies for advantages and disadvantages. Additionally, personal interviews were conducted with four major cooperatives and several leasing organizations.

Keywords: Agribusiness; Marketing (search for similar items in EconPapers)
Pages: 30
Date: 1977-08
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uersfc:314654

DOI: 10.22004/ag.econ.314654

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