Renting business assets before purchasing them for your company is highly advisable, especially for small and new start-up businesses. Whatever industry you’re in there will be many different pieces of equipment essential for getting work done, from common tools such as computers to more specialised items involved in your line of work.
Many companies are tempted to buy everything they need straight away but serious consideration should be put towards renting or leasing items first. Either for the short or long term it can be a huge benefit for both small, new companies and much larger, established ones.
Saves Money
Leasing or hire purchase agreements can be agreed for some equipment while others just offer standard rental charges. Whichever method used can help sort out your business’ finances and save money in some cases. The full cost of the item required doesn’t need to be paid upfront so there’s no need to wait and save up or take out a risky loan to acquire it. For small and new businesses this is great as they’re unlikely to have enough capital.
Making monthly payments helps working out the business budget and cash flow become a lot easier. Many leasers will be flexible to allow a payment plan across a period of time suitable for you to be drawn up. The full cost of lease rentals can often be deducted from taxable income, too.
Business Lunch in the New Economy… by Seb, on Flickr. This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 2.0 Generic License.
Access to Better Quality Equipment
There can be a catch-22 involved for a lot of young companies when it comes to making their mark in the industry. Affording enough of even the most basic equipment to get set up can be a struggle and using it may not lead to the best results. Yet in order to truly compete and grow it may require using the best, more expensive apparatus.
Renting equipment allows access to a higher standard of equipment without having to pay the expense for buying it outright. Leasing companies have superior knowledge and connections in the sector, too, and are able to secure better deals than your business could alone.
Provides a Good Test
If you’re unsure about purchasing certain assets outright but aren’t fully convinced then leasing allows you to test it out first. This avoids making a costly error buying equipment which turns out to be faulty or not right for your business. It also provides short term solutions until you can afford to buy, such as Card Cutters option to rent out credit card machines.
There’s no need to worry about paying for maintenance and upkeep either, as it is the leasing company’s responsibility. Any breakdown or faults also won’t result in an expensive bill for you, so it’s well worth considering trialling business equipment before purchasing.
