What Are The Benefits If You Lease Your Equipment?
Do you own a business or are you still planning to launch your own business? Does a limited capital prevent you from pushing through your plans? Have you heard about equipment leasing? If you’re not yet familiar with the term, take a look at the following equipment leasing benefits that makes leasing an ideal option for a business:
Flexibility
Flexibility is one of the main reasons why equipment leasing is so popular among businesses today. Equipment leasing companies offer different types of leasing terms for every business. For instance, businesses that greatly depend on peak seasons can skip lease payments without getting penalized. Newly start-up businesses can avail of a step-up plan which allows them to defer payment for the first two months of the lease term.
Whether you’re just starting up or is already an established business, there’s a payment term that matches your needs. Whether you intend to lease for a long-term basis or just as a temporary aid, you can find a leasing term that best suits your goals.
If you wish to lease equipment for a limited time, leasing gives you the advantage to pay only for the duration that you’ve used the equipment. When your leasing term ends, you have the option to simply return the equipment to the leasing company. In case you would like to keep the equipment after the term, you have the choice to pay for the residual value of the equipment which is lower than its actual market price.
Freedom from obsolescence
Purchasing an old model of equipment may not be practical because of it will only slow down your production. However, you may not have enough funds to buy the latest model of equipment in the market. By leasing business equipment, you can choose to get the latest models without the need to pay for a large sum.
Furthermore, equipment leasing gives you the freedom from obsolescence. If there’s a new model of equipment that is out in the market, you can easily order it in exchange for the current equipment that you’ve leased. Purchasing equipment does not give you this much freedom.
No down payment needed
Leasing companies do not require businesses to give a down payment. That means you don’t have to set aside a significant portion of your budget just to acquire the equipment you need to start the business. Obviously, the money you saved from a down payment adds up to your cash flow.
Use your cash
Another great advantage of leasing equipment is that it lets you use your cash for other business expenses. If you buy equipment, a huge portion of your budget will be tied up in those purchased equipment. It can take you some time before you can get recoup the money you spent for those equipment. With business equipment leasing, your money is never tied up in the equipment since you pay for them in installments. Add to this, you can use the money you have for other purposes. For example, you can use the extra cash to hire additional workers when needed, buy more materials for production or launch several marketing campaigns to help promote your business.
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