Any business that relies on equipment has some extra strategizing to do when it comes to allocating funds. New machinery is expensive and repairs can add up as well. Equipment leasing, especially for short-term projects, can help your company get the necessary instruments without spending all your working capital at once. When you decide to lease, it’s important to find a company that will offer good enough terms to make the transaction worth your while. Make sure you know what you need and that the leasing company is able to acquiesce.
Minimal Down Payment
If you were able to spend a large sum of money all at once, you’d likely just be buying equipment. Leasing should allow you to avoid any big spending that might hurt your cash flow. The type of equipment will affect how much money you have to pay up front, but it should never be anywhere near what you’d spent if you were purchasing. Leasing companies earn their money in the form of monthly payments on equipment they still own, not through you buying the privilege to rent from them.
Option to Upgrade
One of the main benefits of equipment leasing is that you aren’t stuck with something that might soon be obsolete. Since new machinery is constantly being developed, especially in the technology fields, leasing shouldn’t preclude you from accessing better equipment as it becomes available. Many companies will offer terms with an “improvement” clause, and you should do whatever you can to have this included in your lease. You don’t want to lose out on work because you’re stuck with an outdated machine that you’re contractually obligated to continue renting.
Flexible Time Frames
Every job is different in terms of what tools are needed to do the work. Some equipment you’ll only need for a short while, and this is when equipment leasing is the most beneficial. If a company is trying to make you agree to a minimum number of months that would leave you paying for their equipment beyond when you need it, that’s not someone you want to do business with. By the same token, you don’t want a company coming to reclaim their equipment the minute the lease is up. Flexibility is essentially.
There are better alternatives to buying equipment, no matter the industry. As long as you find a company that understands what you need, equipment leasing can save you a lot of money and make you glad you didn’t spend all your cash on a giant purchase.