The Number 1 Reason to Lease Your New Equipment
May 15, 2020
It takes money to make money, but it doesn’t have to be your money. Capital fuels business. You need cash to thrive. When Dynamic Funding arranges the lease on your new business equipment or technology purchases, you can keep your cash and put it to work for you.
Ten Reasons Why…
#1 Keep Your Cash – When your own capital is not tied up in the acquisition of an asset, you have more funds on hand to use for other purposes – like expansion, marketing, and improvements.
#2 Lower Initial Expense – There is rarely a down payment on leased equipment. You can Keep Your Cash and use it for increased office space, training, or more personnel.
#3 Acquire more and better equipment – If you were to purchase the equipment outright or with a loan, you might feel compelled to select LESS equipment – or equipment of lesser value – in order to protect your cash. Leasing makes it possible to get the things you need, at a comfortable rate, NOW.
#4 Tax Advantage – Leasing allows customers to deduct monthly lease payments from their tax return as an operating expense.
#5 One Payment – Bundle 100% of the cost of the new asset together with its maintenance, installation, insurance and other ‘soft’ costs right into the lease, resulting in ONE monthly payment. Leasing makes it simple.
#6 Flexible Terms – Leases are easier to obtain than bank loans. Good news for customers who need a longer payment plan to lower costs.
#7 Custom Terms – Choose the payment plan that works the best. Whether cash flow is seasonal or as protection against rising interest rates, DFI can structure the ideal plan.
#8 Forecasting – Easier cash flow forecasting with fixed monthly payments. Don’t just ‘Get by.’ With a solid budget, you can ‘get ahead.’
#9 Easy to Upgrade Equipment – When the leased equipment is likely to become obsolete in the near term – like technology – it’s easy to upgrade to new equipment at the end of the lease. Leasing gives the flexibility to easily match current and future needs on a continuing basis.
#10 Purchase and Renewal Options – At the end of the lease, one may choose to purchase the equipment, upgrade to a new system, or continue to lease via an ongoing renewal of their contract.
Is Leasing Right for You?
The major advantages of leasing are economy, protection, and convenience.
Leasing conserves working capital because there is no down payment, tax benefits accrue to the lessee, and structured leases – like step leases – help manage budget and cash-flow cycles.
Leasing is a hedge against technological risk. At the end of the lease term, the lessee has the option to return the asset. If the then fair market value (FMV) of the asset is less than what that the lessor assumed, the lessor bears this loss.
Leasing is convenient. Banks loans are slow. Leases offer speedier processing…often within days, bundled payments, and flexible terms. And with a Master Lease Agreement, there is no need to negotiate a new lease with the acquisition of new equipment.
We Are Here to Help
COVID-19 continues to wreak havoc in every aspect of our daily lives. But, the light is beginning to shine, indicating sections of our economy can begin looking towards opening in ways that are deemed safe for customers and employees alike.
An area being significantly impacted is access to capital. Consider these stats*:
- Small business loan approvals at big banks fell to 15.4% (from a recent benchmark of 28.3%)
- Small business loan approvals at small banks fell to 38.9% (from a recent benchmark of 50.3%)
- Small business loan approvals at credit unions fell to 23.2% (from a recent benchmark of 39.6%)
At Dynamic Funding, we are approving new financings.
We are fully staffed and able help companies with their financing needs so they can keep their businesses moving forward during this crisis.
*Small Business Lending Index.