Leasing fitness equipment comes with certain pros and cons. Here we shall take a look at what the pros and cons of leasing fitness equipment are.
There are many ways that you can finance your gym equipment. Depending on the type of equipment your gym needs, as well as the shape of your finances, leasing fitness equipment could be a good fit for you. Leasing may also be the only option for you if you are a start up business and you are strapped for cash. You should view leasing companies as potential suppliers for all your fitness equipment and other tangible business assets. Let’s take a look at some of the pros and cons of fitness equipment leasing.
Leasing Fitness Equipment Pros And Cons
The Pros
One of the pros of leasing fitness equipment is avoiding financial restrictions. A business loan is known to impose certain restrictions, which might prevent you from borrowing money for future financial operations. When you lease your fitness equipment, you will be able to borrow money for any operations that your fitness centre may have such as acquiring more equipment. You do not need your equipment leasing company’s permission to borrow additional funds
A lease also provides easier credit terms. You are less likely to find a person who is willing to extend you credit purchase than you are of finding someone willing to lease to you equipment. This is because with a lease, the ownership of the equipment will remain with the lessor so if you miss a few payments, the lessor can still get their equipment back. What’s more is that with a lease, you will be able to negotiate reduced payment amounts or a flexible payment schedule. This would not be possible if you had taken a business loan.
Equipment leases hardly ever need down payments. Leasing lets you gain use of your fitness equipment without spending too much money.
Leasing allows you to keep up with current technology so you do not have to put up with outdated equipment. For instance, you can access the latest treadmills infused with the latest software that lets your clients monitor their progress. If you acquired your latest equipment under a short-term lease, then you will have an easier time updating your equipment than if you had made a cash purchase.
Under some leases, your leasing company may agree to repair and maintain your equipment. The cost of such services will of course be factored in your lease payments but at least you will avoid the problem of having to find qualified persons to repair or replace your equipment.
With leasing, you can improve certain financial indicators such as earnings to fixed assets ratios and debt-to-equity. This is only possible if you are able to exclude leased assets and any other rental obligations from your balance sheet.
The Cons
One of the biggest disadvantages of leasing fitness equipment is that the overall cost of the equipment is going to be higher. The easiest way of calculating how much you will pay by the end of your lease is to multiply your monthly lease payments by the number of months you will lease the equipment.
Your lease payments also do not establish any ownership interest. In short, at the end of your lease you will have nothing to show for your payments. This can be very discouraging especially when you realize that you grossly underestimated how much the equipment would be worth at the end of the lease. However, you can always negotiate for a purchase option where a portion of your lease payments will be credited to the purchase price.
Finding The Right Fitness Equipment Lease
The first step that you need to take is to determine how much you are willing to pay and what exactly you need. Once that is done, you need to set some time aside to do your research and shop around for the best possible lease rate.
To make things a little easier, you can visit LeaseQ. This is one of the leading sources of hundreds of equipment financing companies in North America today. You can get lease quotes for your fitness equipment from some of the highly ranked finance companies. If you are worried about your credit score, LeaseQ only performs a soft credit pull so this virtually has no effect on your credit score. What’s more is that you can compare quotes from different companies with no sales people pressuring you. It takes less than two minutes for you to get a pre-qualified quote.
For more information on leasing fitness equipment, simply CLICK HERE.