Good equipment makes all the difference when it comes to running your business. Whether you buy or lease, your machinery needs to do its work so you can do yours. For many, the down payment required to purchase larger equipment is enough to make leasing the only option. Fortunately, equipment leasing can do more than just save you a down payment. If you’re thinking about alternatives to buying, make sure to ask potential leasing companies about the other benefits they can offer.
Terms Include Improvement
If you don’t own the equipment you’re using, you shouldn’t be stuck with it when something better comes along. Most lending companies will include some version of an improvement clause in their terms, allowing you to upgrade the equipment. Sometimes there’s a newer model available, in other cases you’ll just need something different to complete your work. In either case, having the option to exchange your machinery puts your business in a position to do more work and serve more clients.
Popular opinion is that you can write off something you own but not something you’re renting. However, some leases are considered overhead spending that you can deduct as a business expense. If you have the option to skip purchasing and still get money back on your taxes, that might just be the best of both worlds. Talk to the equipment leasing company about qualified financing to see if that’s an option for you.
If you rent equipment for contracted jobs that vary in length, you might not know exactly how long the work will take. You should never be put in the position of having to return equipment before the job is done. Similarly, you don’t want to be stuck with a machine that you no longer need because you overestimated how long a project would take to finish. With most equipment leasing companies, you should be able to bring an instrument back whenever you’re done using it. You’ll want to make sure you also have the option to extend the terms if a job is taking a little longer than you expected. In some instances, businesses will just buy the equipment off the leasing company if it seems like they’ll be using it indefinitely. Make sure to clarify your options before signing an agreement.
Equipment leasing can save you money and give your company more flexibility with regards to the type of machinery you use. Before settling on any terms, make sure the leasing company offers the benefits that will make it worth your while.