Making the decision to lease or buy equipment and technology that your business will need to succeed can be a difficult one to make. There are many factors and considerations that should be weighed when making the decision. To help you, here are some advantages your business could enjoy by leasing equipment and technology:
Leasing equipment helps to ensure that your business has access to the most up-to-date equipment and technology. It’s not uncommon for a computer or other piece of technology to become outdated within 2 years of being brand spanking new. Leasing really helps to stay ahead of the curve to avoid company equipment from becoming obsolete and useless.
When a business is able to continually stay up-to-date on equipment, they are able to have the competitive edge against their competition. Additionally, leasing can enable a small business to acquire sophisticated technology that might otherwise be unaffordable, resulting in being able to keep up with the bigger players in the industry.
Lease payments are often tax-deductible as a business operational expense. This, in turn, helps to reduce the net cost of leasing equipment.
Leasing provides a flexibility that purchasing can’t offer. There are usually a few different options for lease term length, the ability to add equipment to an already established lease and the choice to terminate a lease early (usually this is accompanied with an added fee).
Additionally, if a business wants to experiment with new piece of technology but aren’t sure if it’s something that will truly get used or worth the investment, leasing gives them the option to try it out before making a purchase commitment.
Less Start-Up Costs
In most cases, equipment leasing doesn’t require a down payment (though you may need to make a refundable security deposit), freeing up a lot of cash. If a business was to purchase new equipment, more than likely, financing would be necessary in which case a 25% down payment (at least) would be required. Leasing requires less start-up costs in comparison, giving a company more working capital.
Predictable Monthly Expenses
Leasing also offers the benefit of having a predictable monthly expense. Business have a pre-determined monthly line item that they know will be the same month to month, which helps business to build their budgets more effectively.
No Upkeep or Maintenance Responsibility
Finally, a major benefit of leasing equipment and technology is not having the responsibility of upkeep and maintenance. If an issue occurs from wear and tear or something breaks, the leasing company is responsible for fixing or making updates. This, in and of itself, can be a major money saver in the long run.
In the end, making the decision to lease or buy equipment and technology for your business comes down to dollars and cents. If you’re a new business that’s light on cash or in an industry where you’ll be fighting with equipment obsolescence, then leasing should definitely be considered. At Essential Solutions, we offer easy equipment leasing solutions for your business. For more information about our leasing options, click here or give us a call for a free consultation!