Laser Scanning Systems: To buy or to rent?

I purchased my first laser scanner in 2005 – one of the first in the country – as a natural progression of 40 years in the traditional land and air surveying business. Since then, I have been asked by many of my peers what I think about buying vs. renting the equipment.

How do you know when the timing is right?

#1: Do your research. If you are seriously considering purchasing your own scanner, find someone already in the business and buy them lunch. Ask them their thoughts on getting into this industry. As with anything new, you don’t know what you don’t know. Find someone who has already gone down this path and ask them for their perspective. They have already dealt with issues you have probably not even thought of yet.

#2: Ask yourself why. Why do you want to expand into laser scanning? Will it help increase your profits? Will it speed-up your workflow? Do you have the staff in place capable of effectively running the software and producing high-quality data? Do you have existing clients in place that can benefit from laser scanning? Can you afford the right scanning system? If not, the timing may not be right.

When we purchased our first scanner, we had a two-year contract in place where we could immediately put it to use. Though we could have completed the job without laser scanning capabilities, having it definitely helped us reduce the required manpower in the field and greatly increased our safety. (We were surveying a long, busy road corridor and, rather than having to do the work in traffic, the laser scanner enabled us to scan the project and pick up the necessary data from the road’s shoulder.)

#3: Shop around. If you decide to purchase, educate yourself on the options. There are many different types of scanners, all designed for specific kinds of projects. There are two basic kinds of scanners: phase-based and time of flight. Prices run from around $65,000 to $185,000. Keep in mind that 3D laser scanners are not all equal: different scanners doo completely different jobs.

#4: Consider the “hidden” costs. Let’s say that purchasing a mid-range scanner with software and accessories will cost you around $125,000. If you insure your scanner, it will cost an additional $2,000 to $3,000 annually. (And sales tax will run you $10,000 or more.) You’ll also need a good CAD technician who is proficient in Auto Civil 3D. These types of techs usually take 30-90 days to really become proficient on the software – and six months to become a “wizard,” capable of measuring different environments and delivering multiple 3D products. Let’s say this cost of learning is around $15,000 (this shows up in loss of revenue because until your tech is proficient, some elements will take twice as long to complete.) There is also a learning curve on the field work, though it is less ($7,500) and you will have to upgrade two computers to manage the data – one to process the data and the other to produce the CAD drawings ($4,000 each). This brings the total cost of your $125,000 3D scanner to around $168,500 in the first year – and this still doesn’t include any associated financing charges.

#5: Consider the ROI. Using a 36 month timeframe and the example above, you would need to generate at least $4,400 per month in additional cash flow to break even on the purchase of your scanner. To make a 15% return on your investment and pay back the principal (with interest) in three years, you would need to generate an additional $5,060 per month.

As you can see, the purchase of a 3D laser scanner is a serious investment! But it can also be a significant investment in your business. This high-definition technology enables you to do several things with your business that you couldn’t do with traditional surveying services alone. It is also much more efficient, so it is reasonable that you can run your business more efficiently and with less headcount.

If your business is primarily focused on property surveys and construction staking, these types of jobs don’t typically produce higher profits with scanning and your labor costs will not likely decrease. But if your work is primarily urban topographic surveys, architectural as-builts, complex facilities or transportation projects, for example, laser scanning could definitely help with your production.

Ideally, you could increase your services to existing clients and generate additional revenue to grow a separate division solely dedicated to scans.

But more often, the best choice is to start small. If you run into a project in which 3D laser scanning could save you time and money, you are probably better off finding a competent company that you can partner with to do the scans. Go into the field and become involved in the process. Watch what is going on. Spend a few hours with the 3D data technicians to learn how they extract useable data from a scan.

Roughly 25% of the process is the actual scanning. Most of the work is computer processing and data extraction. Perhaps it is most profitable to hire a 3D laser scanning partner to do the actual scan and then train your team how to use the software and extract the data.

It’s all about timing and what works best for you and your business. When you are comfortable and the right series of jobs comes along, you can buy your own scanner and control your own quality and timing. Until then, renting may be the best option.

Tate Jones has over 40 years of experience in land and aerial surveying and was one of the country’s earliest adopters of 3D laser scanning technology. A nationally recognized expert in the field of 3D data capture, he has worked with hundreds of clients in the engineering, architectural and construction industries. Contact him at tjones@3DLaserSurveys.com or visit www.3DLaserSurveys.com.