Our CEO, Vernon Tirey, provided his equipment financing expertise to plastics packaging industry resource, Plastics Today, in an article published last week. Vernon spoke with contributor, Clare Goldsberry, about alternative financing methods and why equipment financing is an efficient, cost-effective method for businesses across industries to secure the equipment they need to operate.
An excerpt of Vernon’s commentary is as follows:
Equipment financing pretty much works the same across any industry, Tirey explained. “Loans and leases are still available—the structure is available—but the financing rates can vary depending on a variety of factors. First, the type of equipment really matters when it comes to financing. Lenders like to know why you need the equipment; if the equipment is core and critical to the business, the lower the risk to the lender. The useful life of the equipment is also important. After five years of financing, if the equipment holds good value, that significantly lowers the risk for an equipment financing company. The value of used equipment in the secondary market can also have a huge impact on the ability to keep financing rates low for borrowers.”
Tirey offers another piece of advice: Though most companies financing equipment think most about finding the lowest monthly payments, if the equipment you need will be obsolete in three to five years, consider a lease rather than a loan. “You can keep costs low and return the equipment at the end of the finance period to more easily keep up with technology advances and always have the best equipment available by upgrading. Again, it depends on why you’re buying the equipment. If you’re going to use the equipment for 20 years, with a loan or a $1-out lease, you can use it free for the last 15 years.”
LeaseQ has valuable experience in the food packaging industry to assist businesses looking to secure top-notch equipment without breaking the bank. To read this Plastics Today article in its entirety, please visit: https://www.plasticstoday.com/injection-molding/staying-competitive-requires-state-art-equipment-should-you-buy-or-lease/199276528856913