Whether you have just gone into business for yourself or operate a company with a budget in the millions, you will need to purchase equipment for the business at some point. From computers to machines for an assembly line to company vehicles, large equipment purchases don’t come cheaply. This is just one of several reasons why many business owners look to equipment financing to obtain the products they need without blowing their company’s budget on a single purchase.
How Does Equipment Financing Work?
When you finance a piece of business equipment, you sign a lease with the company offering the equipment and can use it until the end of your lease. Some business owners sign equipment leasing agreements knowing they eventually want to purchase the item while others only want to lease a large piece of business equipment until it becomes outdated. In fact, the ability to use equipment while it’s new and in great working order and then return it as it starts to become obsolete is one of the greatest benefits of this type of alternative financing.
Other Benefits of Equipment Financing
Financing is easier on your cash flow because you can budget for the monthly payment rather than pay out the money all at one time. Another great financing benefit with equipment leasing is that you shouldn’t have to make a down payment. That means you can leave with the equipment and not make your first lease payment for 30 days. Equipment leasing could also put you in the position to claim a tax deduction next year.
Having access to the latest business equipment ensures that your company can compete with others in the industry. Best of all, you won’t have buyer’s remorse business owners sometimes have when they must make payments on equipment they no longer own but still need to pay the loan in full.
Could equipment leasing be the right financing option for your small business? Contact Alternative Capital Source today to request an application and learn more about all our financing options.