To Buy or to Lease? – Getting Equipment for a New Business

Many businesses today are turning to equipment leasing to obtain the equipment they need rather than buying them outright. Equipment leasing can give you the peace of mind in knowing that at the end of your lease period, you can trade in your equipment for more up to date equipment.

When you decide to use the advantages presented by equipment leasing, you will need to locate a leasing and financing specialist. Ideally, it is best to look for an equipment leasing specialist who will treat you like an equal partner. Your equipment-leasing specialist should take the time to answer whatever questions you may have during this transitional period.

Growing a business can be difficult and cash is frequently in short supply. Equipment leasing offers one way in which you can spend less money. While renting costs far too much money as a long-term option, leasing equipment such as furniture, fax machines, and computers offers numerous important advantages.

Equipment leasing can improve your cash flow. One of the best advantages of equipment leasing is that it will free up cash that you can use in other areas of your business. In some cases you may even be able to take advantage of equipment leasing programs which offer little to no down payment. By comparison, loans to finance the purchase of equipment commonly require down payments of 25% or more.

It is easier to finance a lease than a purchase. Most banks typically want to review two to three years of financial records before extending a loan to purchase equipment. This can be a problem for new companies. By comparison, equipment leasing companies may have less stringent requirements. This provides a tremendous advantage to companies who are just beginning to grow their business.