What the equipment budget is, and why contractors get it wrong
The equipment budget is money you commit to in a quotation before you know whether the job is yours. Put too little in and the profit you planned disappears into a few extra rental days. Put too much in and you lose the job on price. The goal is accuracy, not padding.
The mistake is rarely the rates themselves, since those are published. It is counting the wrong number of days, and assuming the rental line contains only the machine. Delivery, consumables and the days a machine sits idle on site all arrive later.
A safer method is to split the line into four parts from the start: machine rental, delivery in and out, consumables that get used up, and the deposit you pay in advance. Each behaves differently, so they cannot be estimated as one number.
One figure changes how you plan everything else. At AR Rental Tools the weekly rate is 6 times the daily rate on every item, which means every machine in the fleet has its break-even on the same day.


