How much does it cost to lease fitness equipment? It all depends on a number of factors.
Leasing is a great way to acquire expensive fitness equipment without breaking the bank. It does not matter whether you are starting a new fitness center or adding new equipment to your gym, leasing allows you to equip your gym with the latest equipment with little money. Most fitness leasing companies will lease all the furniture and equipment you need. The most commonly leased fitness equipment include mats, exercise benches, universal gyms, free weights, stair steppers, elliptical, treadmills and so on. A lease allows you to make payments over a period of years, usually two or three. When the lease term expires, you have the option of purchasing the equipment at fair market value, return it or upgrade to newer and better equipment.
How Much Does It Cost To Lease Fitness Equipment?
Your monthly lease payments are determined by several factors: your credit rating, the total cost and quality of individual pieces of equipment, the length of the lease, and the type of lease.
Credit Rating
Businesses with lower credit ratings or damaged credit scores are likely to attract high interest rates from fitness equipment leasing companies. Your credit score is important because it will give your lessor a clue as to if you will be able to repay any debt accrued in full and in a timely manner. While not all fitness equipment leasing companies have programs that cater to businesses with damaged credit scores, most of them do. Unlike banks or other lending institutions, leasing companies do not need you to pay any form of collateral so your credit score is what will determine the rate that you get.
Total Cost And Quality Of The Equipment
The total cost of the equipment will be determined by the quality of the equipment. Pre-owned or second-hand equipment is likely to be much cheaper to lease than new equipment. Contrary to popular belief, you can lease second hand fitness equipment that is in good shape. Many people believe that second hand goods are damaged goods. While this might be true, it may not always be the case. You can still get quality second hand fitness equipment from reputable leasing companies.
Length Of The Lease
It is much cheaper to lease fitness equipment over a longer period of time than over a short period. Shorter leases tend to be much more expensive than longer leases. The downside of longer lease periods is that you risk being stuck with obsolete or outdated equipment. Lengthier leases are suited for equipment that does not need to be regularly updated. It is also suitable for equipment that is not subject to quick wear and tear.
Type Of Lease
Capital leases are generally more expensive than operating leases. The good thing about these types of leases is that you get to purchase the fitness equipment at the end of the lease period at $1. The high monthly rates that you make during the entire lease period are usually considered as a down payment for the equipment. In addition, ownership of the equipment will be transferred to you and you will be responsible for repair and maintenance of the equipment during the entire lease period.
An operating lease on the other hand is suitable for gym owners who want to pay for use of the equipment and don’t plan on purchasing the equipment at the end of the lease period. Monthly lease payments for this type of lease are usually very low but ownership remains with the lessor. At the end of the lease period, however, you can purchase the equipment at fair market value or renew the lease. If you renew the lease, it will automatically convert into a capital lease.
Bottom Line
Leasing fitness equipment is a relatively cheap way of procuring equipment for your fitness center. Leases rarely require down payments and if they do, it is relatively small. Leasing provides you with an opportunity to acquire all the equipment that you need, without compromising your cash flow.
When you lease fitness equipment, you’ll always have state-of-the-art machines which is a big plus for you if you want to attract and retain members.
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