How can rates for equipment leases save your business money in the long run?
All businesses need to make money, whether they’re restaurants or gyms or coffee shops, but making money’s about more than just customers. You need to manage expenses as best as possible so that way your profit is as great as possible, and that means that examining all of your options as far as employees, equipment, rent, and more is very important.
You only want the best setup for your business however, and that will come at a price, so finding deals with little to no downsides is ideal. The main way to get deals is through your equipment, because equipment is one of the most expensive parts of a business but also the most lenient as far as options.
You can claim equipment as an asset and get an equipment loan if needed, allowing you to purchase your hardware at a reasonable rate, or you can get yourself an equipment lease and borrow the hardware for a rate. The question for business owners is whether they should purchase the equipment right up front and own it or pay a flat monthly rate for equipment leases.
How Purchasing Equipment Works
Buying equipment is something that completely depends on the equipment you’re getting; for instance, buying smaller hardware is normally a decent idea because it lasts a while and is inexpensive, like hammers and other tools. However, when it comes to more heavy duty equipment, especially stuff that relies on quality more than anything else, purchasing becomes a disadvantage.
When you buy higher end stuff, like (for restaurants) kitchen equipment and (for gyms) treadmills, the best equipment is more expensive, and better equipment gives your business more of an edge overall. However, when you purchase equipment, you obtain full responsibility of it, meaning if anything happens to the equipment you’ll have to deal with it, no matter what it is.
The problem with equipment is that something’s guaranteed to happen, whether it breaks down or becomes outdated, and most equipment that reaches these points must be replaced, within only a few years as well. Plus, if you have to buy a great deal of more expensive equipment as a new business, you probably cannot afford all of it along with your other expenses, meaning you’ll have to get a bank loan.
If you don’t have good credit or are late on your payments, your interest rate could become higher than normal, and having a loan with equipment that needs money over time is dangerous. You could end up not being able to pay off the loan before your hardware breaks down, and you’ll have to purchase new equipment, digging yourself deeper into debt.
Rates for Equipment Leases
With equipment leases, you’re given the freedom to start up your business in whatever way you choose without dealing with the pressure of paying for and maintaining your equipment. The responsibility you have when purchasing equipment is lifted when you lease your hardware, because you get to pay a flat monthly rate to get the equipment for use over the contract period.
Plus, you don’t have to worry about equipment breaking down; all repairs are handled by the leasing company, so you don’t have to pay a ridiculous amount to fix and/or repair your hardware. Plus, at the end of a lease, you get to get your equipment upgraded and continue the lease, purchase the hardware at a lowered price, or simply return the equipment and close up the lease.
Get an Instant Quote on Your Equipment Lease, Free
The two main factors in leasing are the rates for equipment leases and the contract period, and those depend on what you want for your business. It’s recommended you have an ideal contract period in mind and look up what you want to pay for a monthly rate so the total cost you pay isn’t ridiculously high compared to the purchasing price.
To learn more about leasing and the rates for equipment leases, click here.