This blog on container lease agreements will take you through the 4 types and their benefits for your business. Additionally, you’ll also get to know how Container xChange can help you lease boxes at competitive rates and simplify the leasing agreement process for you.
Leasing agreements are the foundation of any leasing interchange that takes place between a leasing company (lessor) and a user (lessee). This is because it has everything of importance listed in it. Right from the number of years or months the container is being leased out, to what happens if the lessee decides to end the lease before the term is up.
It also tackles your worst fear – a lost or damaged container. A container lease agreement also gives you details about who is accountable for damage and repair, which is why it’s a crucial part of your business. Having everything written down and signed makes the leasing process legally viable for both parties involved and avoids misappropriation from either end.
But if you’re already clued up on container lease agreements, and looking for a container on lease you can use our public search to browse through different container types in your preferred location. Simply type in your location, the box you require, as well as the pick-up and drop off location, and click search.
What are the different types of container leasing agreements?
The different types of container lease agreements are:
- Master lease
- Long term lease
- Short term lease
- One way lease
These are different types of container leasing agreements to consider for any leasing interchange.
Let’s explore these types of container leasing agreements in detail below for your better understanding:
Master lease container rental agreement
The master lease is a type of container lease agreement where the leasing company takes charge.
How does it work?
This agreement is also known as a ‘full-service lease’ or ‘container pool management plan’. After you find depots where you can collect the containers, separate agreements are drawn up for each container collected from the depot. This contract comes into effect only when the lessee collects a container from a depot.
Advantages of a master lease container rental agreement
The lessor is responsible for the full management of the container fleet and this includes maintenance and repair. This also means that when you need an empty container, the lessor will make all the arrangements to ensure you get what you need. The agreement is also the most flexible and offers numerous pickup and drop-off locations. You also have the option to store your container at the lessor’s depot, saving you storage fees.
Disadvantages of a master lease container rental agreement
Well, you may have guessed this one already. It’s an expensive arrangement! Under this agreement, while the lessor takes charge of the process, you pay the higher rate. Besides, if you drop your container off at disallowed locations, you’ll be imposed heavy fines.
When to use it?
The ideal time to opt for this agreement is when you need to lease containers for an unspecified period. Because it’s flexible, you can plan and budget your costs accordingly. It’s also handy when you don’t want to concern yourself about container damages and storage costs because that falls on the leasing company.
Long-term container lease agreement
As the name suggests, under this agreement, you agree to lease for a fixed period. It’s also known as a ‘dry lease’.
How does it work?
Through the long-term container leasing agreement, you sign a contract that extends from 5 to 7 years for new containers and 1 to 5 for used containers. You can agree upon a fixed amount of time and a delivery schedule. And you can decide the number of containers you want to lease.
Advantages of a long-term container lease agreement
Many long-term agreements come with a negotiable clause, which means you can modify the rental rates depending on market conditions. Also, you’ll probably receive brand-new containers under this agreement. The shipping lines can also directly interchange containers with another carrier. This brings flexibility in repositioning the containers. But in that case, the leasing company will charge a fee that will be mentioned in the agreement.
Disadvantages of a long-term container lease agreement
If you pick this agreement, you’re in charge of repositioning, repair, and maintenance. Unlike the master lease agreement, the leasing company doesn’t bear the management responsibility here.
When to use it?
Haven’t decided whether you want to return the container after the signed duration or extend the contract? Not a problem at all! This agreement is a good option for you because it’s more customer-defined.
Short-term container lease agreement
We all know the industry is volatile and subject to uncertainties. It’s probably why someone thought of creating a short-term container lease agreement! And no wonder it’s also called ‘spot market lease’ sometimes.
How does it work?
You can sign this agreement for a brief period of time. The duration of this container lease agreement is more than six months.
Advantages of a short-term lease agreement
It’s common to use a short-term lease when there’s a sudden surge in demand. So, this agreement helps you plan ahead of time.
Disadvantages of a short-term lease agreement
This agreement is centered around volatility. Usually, the rents are high. Besides, leasing companies don’t prefer to keep too many spot containers. After all, they want their containers to always be in use.
When to use it?
As we mentioned, this agreement helps you prepare ahead of time. So, you can use it when you plan methodically, aiming at making full use of regional and local surges in the business.
One-way container lease agreement
Do you want a container just for a one-way trip? Then a one-way container is the most ideal agreement for you. We’ve seen that lessees have a varied range of concerns and requirements. We hear you and we’re with you. You can read more about how we’re creating an efficient network of partners on our platform for one-way moves below.
How does it work?
Simply put, you lease a container from one location to another. You and your lessor can both reduce costs and optimize operations. In fact, on some stretches, the container owner pays you to lease their containers!
Advantages of a one-way lease agreement
One-way container leasing is ideal if you have to change needs in different regions. Through our online leasing platform, we can put you in touch with hundreds of leading companies to lease containers from. We also offer you amazing transaction speed. We recommend the one-way lease in particular if you’re a freight forwarder and want a container with immediate flexibility. It keeps you prepared if your customer comes to you with an urgent request to have their cargo transported.
Disadvantages of a one-way container lease agreement
This is not an agreement that can be useful if you need to lease a storage container, or you have a standing need for containers long-term.
Now that you’re well informed about the different types of lease agreements, you might want to go ahead and lease a box. Here, at Container xChange, we understand that finding the right container for your specific requirements can be a daunting task. That’s why we’ve built a global digital marketplace that connects you with a vast network of 1,500+ vetted container owners and leasing providers, all in one convenient platform. And 50,000+ boxes to choose from across 2,500+ locations worldwide. So come and lease your box at competitive rates, streamline your logistics, and unlock the potential of seamless container solutions by clicking the banner below!
Container lease agreement sample
With all your information on container lease agreements intact let’s now uncover the details within the document.
A container lease agreement has information such as the two parties’ names, the lease’s term period, the delivery address, and the termination protocol. Other information included is the type of container and the cargo, who is liable in case of container damage or loss, the price to pay for the damages, and the container lease type.
Have a look at a sample container lease agreement below.
Please note this is not the entire agreement and just a part of it. To be considered only for reference.
Container rental agreement and BIMCO
Now, container rental agreements and the BIMCO agreement are both related to the leasing of containers. And before you lease a container you need to know what BIMCO is as well as the purpose it serves.
BIMCO or Baltic and International Maritime Council is one of the largest international shipping associations representing shipowners, brokers, and agents. Its membership accounts for over 60% of the world’s merchant fleet capacity and includes members in over 130 countries, including managers, traders, and marketers.
Its key objective is to secure its global members by providing information and guidance, while also encouraging ethical business conduct and fostering harmonization and standardization of major shipping procedures and agreements. They provide shipping contracts and clauses and ensure complete neutrality between container owner and user.
All members on the Container xChange platform must sign the BIMCO agreement when going through the process of leasing containers. That way, we can avoid confusion and both parties remain informed and on the same page.
How to choose the right container lease agreement
Before making a decision to lease a container you need to keep a few things in mind such as:
- Time period – How long do you need the container for and the purpose?
- Finance – How much are you willing to spend on leasing a box?
- Flexibility –How much control do you have as a lessee?
- Container type – Are the containers you need available for lease?
These questions will help you get a clear understanding of the agreement you should opt for and eventually make wise monetary decisions.
Lease containers of your choice on Container xChange
If you’re now ready to lease containers at inexpensive rates and manage your container lease agreements with ease then Container xChange is the right platform for you.
We have the world’s largest network of container leasing companies on our platform. Do business with the likes of Seaco Global, Trident, SeaCube, and other trusted names. While it’s often a challenge to associate with the biggest players in the industry, we have a rigorous vetting and networking process for all companies.
We have 1,500+ vetted companies on our platform. And you have 50,000+ containers to choose from in 2,500+ locations worldwide.
We also have the BIMCO contract in place which all members sign when going through the process of leasing containers. This not only helps both parties to remain informed and on the same page, but it also eliminates the hassle of networking by yourself and scheduling endless calls with multiple companies about contracts and terms. Thus, simplifying your leasing agreement process by making it smoother and faster.
Once you have signed the lease agreement, you can also keep it safe online and get easy access on the platform. Apart from the benefits mentioned above that you can find on our platform you can also expect the following from us:
- Secure and easy payments – We offer 100% secure payments with the xChange wallet, which has your entire transition history under one platform. And also sends you only one consolidated bill each month.
- Near real-time container tracking- Remember the panic that set in at the beginning of the blog about boxes being lost? You don’t have to worry about that anymore as we also give constant updates on the whereabouts of your containers. You can easily lease boxes through our platform and track them too.
- Insurance policies for your containers to keep your boxes covered for damage claims.
- Market price transparency and competitive, comparable, and negotiable leasing rates on boxes are other added benefits.
So don’t wait any longer, simply click the banner below and start leasing quality containers with us today!
Container lease agreement: Common FAQs
What does container leasing mean?
Container leasing means that you enter into an agreement with a container supplier to rent their container. The supplier offers the container to a user for a certain period and at a rate decided according to the terms of the agreement.
How much does it cost to lease a one-way container?
The prices to lease a one-way container varies according to the regions. For instance, in January 2022, the average one-way pickup charge from China to Germany was $3100. Pickup charges to North America and Europe are currently, relatively high.
How do you lease a shipping container?
You lease a shipping container by first choosing the container type, size, and quantity. Then you figure out the length and type of lease. Choose a suitable leasing company. And submit the paperwork. Then you arrange for container pick-up and finally, make the payment!
What are the different types of container lease agreements?
The different types of container leasing agreements include the Master, Long-term, Short-term, and One-way container lease agreements.