If you own a business, you know how expensive it can be to get the supplies and equipment you need to operate. Leases are a great way to get the supplies and equipment your business needs without having to pay for everything up front and all at once. With options from traditional leases to lease-to-own, you can choose the method that works best for you and your situation.
There are a number of benefits when it comes to leasing equipment:
You can get up-to-date equipment. Buying used equipment is a good way to get a great deal, but sometimes used equipment doesn’t work as well as it once did, and it can be too outdated to perform some of the functions you need. Leasing equipment gives you the opportunity to get up-to-date equipment without the hefty cost of buying something new.
You can upgrade to new equipment. If you buy equipment, the cost can make it difficult to upgrade to new equipment until it’s absolutely necessary. If you’ve been leasing older equipment, though, you can switch to new equipment for less than it would cost to go purchase the new equipment on your own dime.
You have more options. If you buy your equipment, you might be limited to a specific budget, which could mean you have to settle for a piece of equipment that will work instead of one that does everything you need and want. If you lease, you have a wider variety of options, ranging from older equipment to brand-new equipment and everything in between.
You may get training and support specific to the equipment. When you buy equipment, you are given a user manual and left to figure things out yourself. Although you can use resources like the internet, it may take you quite a while to get everything figured out. When you lease, many companies also offer expert support and even training so your staff can operate the equipment effectively and efficiently.
You can get financed more easily. It can be difficult to secure financing to purchase some types of equipment. If you don’t have the best credit score or the collateral needed to get financing, you may be out of luck. When you choose to lease equipment, it’s easier to get the green light and pay for the things you need.
You may not have to make a down payment. When you purchase a costly piece of equipment, you may be required to make a fairly large down payment, which takes cash out of your pocket. When leasing, you don’t always have to make a down payment, which helps you stay up and running and keeps more cash available to your business.
You can “try before you buy.” When you purchase equipment and it doesn’t work out, you’re stuck trying to either sell it or trade it in. If you lease equipment, you have the opportunity to test it out and see if it works for your company. After a while, if you decide it isn’t the right fit for you, you can simply switch to another piece of equipment without the hassle of getting rid of the one that didn’t work.
You can write the equipment off when you file your taxes. Whether you buy or lease equipment, there are tax breaks available. Business owners can take advantage of Section 179 Tax Deductions, which could get them up to $500,000 in deductions, in some cases.
You may not have to pay for maintenance. When you purchase equipment, any maintenance or breakdowns have to be paid for out of your own pocket. When you lease equipment, on the other hand, some leasing companies will schedule regular maintenance and have someone on call for any necessary repairs.
You can take on more work. If you buy equipment and someone asks for a custom job which requires equipment you don’t already have, it may be too costly for you to purchase what you need, and you won’t be able to take on the job. When you lease, you have the opportunity to lease additional equipment, which allows you to offer the requested service and expand your business without the risk of paying for new equipment and not having enough work to support the purchase.
There are a lot of benefits to leasing, but it can be difficult to keep track of all the agreements for different pieces of equipment if you have multiple leases. Combining your leases so they are all under one roof is a great way to stay better organized, know the policies, terms, and conditions of the leases, and simplify your monthly payments.
While there are many benefits to both buying and leasing equipment, leasing seems to offer more flexibility and opportunity overall. In your experience, have you found buying or leasing to be a better fit for your business?
If you’re looking to add equipment for your business, contact the team at Currency today!