What are the Advantages of Leasing?
Conserve Your Capital
Leasing preserves capital to invest in profit generating opportunities. Working capital intended for equipment purchases can be retained to be put to work elsewhere and earn a higher rate of return.
Banks often require business plans, several years of banking history and perfect credit. An equipment leasing company can often accommodate those with less-than-perfect credit and limited financial history.
Preserve Your Credit
A lease is independent from other sources of financing. It extends credit limits leaving more traditional sources open should they be needed. An established lease account can make it very easy to acquire more equipment when it is required.
Make Budgeting Easy
Lease terms, payment streams and options can be tailored to fit your budgets. For example, you may have balloon payments, step up or step down payments, or even seasonal payments. When acquiring equipment, other incidental costs such as shipping and installation charges can be included in the lease. Also, regular lease payments simplify accounting procedures, eliminate depreciation scheduling and ensure consistent control over equipment expenditures.
Sales and Leasebacks
If you are in business and own equipment, then why not use it as collateral to access capital? For example, you may be able to sell your equipment to a leasing company and then re-lease the equipment providing quick cash to your business. It’s a perfect scenario for the astute business owner, or company needing working capital.
Leasing is Inflation Friendly
As costs and potentially interest rates go up over three, four, five years, you still pay the same monthly payment as when you began the lease therefore making your precious dollars stretch further.