When looking at leasing vs buying laundry equipment, which is the more cost effective?
Whether you’re a Laundromat in the city or a college dorm or an apartment complex or a restaurant, normally getting the equipment to take care of your clothing cleaning is fairly important. Some of these businesses only need a few washers and dryers, while others need a large number of them, but either way, you’ll need an expensive amount of equipment.
All businesses struggle in getting equipment solely due to expenses; they already spend money on buying the building, hiring employees, paying bills, and more. Having to pay for a large quantity of hardware can be just that much more troublesome for a company, especially because in the case of laundry equipment, quantity adds to the quality.
In other words, the more washers and dryers you have, the less people have to wait to get their clothes cleaned. Most businesses look into leasing equipment simply because they can cut expenses in the process of getting all of the hardware they need, but many business owners worry about the potential catches in the process.
Other business owners simply want to own all of their own equipment so they just end up buying the hardware, only to learn that there are downsides to buying equipment. There are advantages to both leasing vs buying laundry equipment, but when examining the two, which is the better choice overall?
What are the Advantages to Buying Laundry Equipment?
When it comes to equipment, many business owners aren’t comfortable with the idea of using hardware for years at a time that isn’t theirs. They want to know that the equipment in their building is their property, and this is understandable.
Owning equipment does have its advantages in the sense that you garner complete responsibility for all of it and don’t owe it to someone else. It also provides you with the ability to claim it as a business asset, getting you more money over time. However, buying equipment oftentimes puts business owners in a pickle either way.
For example, say you were to buy hardware that was inexpensive. Normally, inexpensive hardware doesn’t last a long time in the course of your business, meaning you just put a chunk of your business money into equipment that either won’t last long or will break down over time consistently. Or, even worse, you just bought equipment that has been immediately topped by newer, better equipment, and you lose your advantage compared to other companies.
Buying equipment is normally the better option for long lasting hardware that doesn’t break down and won’t get topped by better equipment anytime soon. The downside here is that equipment in this category is oftentimes far more expensive because it won’t break down and is still considered modern hardware; business owners will get stuck getting a bank loan just to be able to buy the equipment.
How does Leasing Work for Business Owners?
The process of leasing is fairly straightforward and is essentially an equipment loan: you get the equipment for a specified period of time for a flat monthly rate, and you get multiple deals out of the process, like getting tax deductibles and potential upgrades on your equipment. Versus buying, leasing is convenient for long run or short run equipment as well as equipment that is up-to-date or constantly needs to be upgraded.
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The catch to leasing is that leasing is a deal offered to you, and if you don’t get the right deal, your business will end up in hot water. A bad lease can snowball into something much worse for your business.
For instance, if you get a long-term lease on equipment that you don’t need long, you’ll end up paying monthly rates for hardware you’re not using, and to get out of it, you’ll need to pay a high cancellation rate. Leases aren’t mandatory though; there are plenty out there, and you get to choose the lease you want.
That’s why you need to know what you want out of a lease as far as monthly rates and contract period and such; a good lease can be extremely advantageous to your business, but you need to find it.
Leasing vs Buying Laundry Equipment
The trick to laundry equipment is that most businesses need a few. After all, dorms and apartment complexes and Laundromats handle massive bulks of clothing at any given time, so having even less than ten washers and dryers might not be enough.
Even restaurants will need a few of each to handle all of the napkins (if your restaurant has washable napkins), and even a couple washers and dryers rings up a high bill. Unless you have thousands of dollars floating around, the chances of you being able to buy the equipment are low, and that’s a good chunk of your money going to just equipment.
Leasing is normally the better option, because higher cost equipment that lasts a while and won’t break down often is fairly ideal if you get a good lease. Again, a good lease depends on you finding a good lease: know how much you want to pay and how long you want the lease, and your business will save money upon start up and be able to run that much smoother.
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