Container ships are the visible face of globalization. At any one time, there are 100,000s of ships loaded with containers making international trade happen. Without these huge ships soaring the high seas, the kinds of luxuries that we are used to in the era of mass globalization wouldn’t be possible. The trick is the containers themselves, which are equal sized metal boxes that make loading and unloading prompt at any port. Australia is a continent which relies heavily on shipments for imports and exports. With this in mind, investing into a shipping container is a smart move.
Making the Investment
The average price of a 40-foot (about 13-metre) shipping container is around $US4000. There are companies in Australia that offer them for sale or lease, with shipping containers for sale in Melbourne, Sydney, Brisbane, Adelaide, and Perth. Once you buy the container it is immediately leased to a shipping company. Insurance is provided by the leaser, and there are no other expenses you need to pay. Each container has a lifespan of around 15 years.
Making a Return
Once you’ve made the investment, you’ll start making your money back straight away. On a fixed-plan lease you will receive a guaranteed 12% per year, paid quarterly. The push is on for investors to buy five of these containers. However, the containers must be paid for with cash.There is also another option, known as‘aggressive deployment plan lease’, whereby the leasing company sublets the containers on short-term contracts. The returns are variable, but tend to generate higher returns, albeit there is a bigger risk. However, this system usually outperforms the fixed-return option, earning investors closer to 20%per annum as opposed to 12%.
The Benefits
Owning a shipping container is generally a safe investment. Even though the owners don’t know where the container goes or what it carries, the container itself is insured against damage or loss. Furthermore, your containers may qualify for 10% annual depreciation allowance. In other words, owning a shipping container is a very hassle-free investment; all you need to do is make the initial investment and then basically you can sit back and wait for the returns to roll in.
A Wise Move
A shipping container is an asset that provides consistent returns, and is not like other financial investments that are linked to the share market or interest rates. If you have the cash to front, you can’t lose more money than you put in. The only drawback is that as owning a shipping container is a physical asset, it is an unregulated scheme. However, most investors have reported a satisfactory investment.
The Verdict
All in all, investment into shipping containers has proved to be very lucrative over the past 25 years. If you’re looking to put your money into something with a guaranteed return, then buying a shipping container is a smart move. With a fixed-plan you can see a return of 12% per annum for the lifespan of your shipping container, which is around 15 years. With the aggressive deployment option you will see more like 20% return, although there is more risk involved. Otherwise, shipping containers are considered to be a very hassle-free investment, so if you’re looking for an investment that will constantly pay back, then this is a wise one to make.