If you thought equipment leasing was just for computers, server systems or high tech IT equipment – think again.
For many start-ups and small business owners, signing up to lease technology is a great way to get their businesses off the ground. Leasing a computer meant you could spread out the cost of the equipment over a longer period of time and you could conserve your precious capital for other uses as marketing or getting the word out.
The benefits of leasing can extend further than just IT equipment. No matter what industry you’re in, your equipment dealer or supplier may very likely have lease terms and financing available for you to get the assets for your business.
What type of equipment can my business lease?
Leasing is available for almost any asset or piece of equipment that’s used for business purposes. This includes leasing IPL machines for a medical aesthetics clinic, point of sale equipment for retailers, industrial vacuum cleaners for commercial cleaners, or unregistered tractors for farming businesses – the list goes on.
- Furniture for the office
- Fit-outs for your salon
- Autoclaves for your medical or veterinary clinic
- Earthmoving equipment for your industrial business
In fact, you can lease practically any piece of machinery or equipment that’s used for your business.
What does a leasing arrangement involve?
When you sign a lease for equipment, the lender takes ownership of the indicated asset and then charges you a monthly payment for its ongoing use. The equipment remains the property of the lender.
Lease agreements vary depending on the asset in question and the specific requirements and history of your operations. When you sign your lease, make note of the specific terms and conditions that are associated with your agreement and make sure you know the following:
- Who is responsible for repairs? – in most instances, if the asset breaks down or requires any maintenance or repairs, you will be responsible for covering the costs. Check your agreement terms to confirm who will be responsible for upkeep of the leased equipment.
- What are my end-of-term options? – at the end of your lease term, you may have a few options available to you, such as upgrading to new equipment or signing a new lease. Alternatively, you can simply return the equipment back to the lender who will then likely sell it on or make arrangements for its disposal if it is past its useful life.
- Can I buy the equipment at the end of my term? – in many cases, you will be able to make the lender an offer to purchase the equipment at the end of your lease term. However, keep in mind that there is no implication of eventual ownership with leasing and purchase arrangements are made outside of your agreed terms and conditions and on an individual basis.
How do I lease the equipment I need?
If you’ve decided that leasing is the way you want to go, there are a few ways to find a lease provider. While many banks and major lending institutions do commercial leasing options for their business customers, some business owners may find the paperwork and documentation process that’s required for securing bank finance complicated or prohibitive.
There are other types of finance providers that specialise in equipment leasing for business, including offer FlexiCommercial. You can choose the equipment you want and then apply directly to lease the asset through the financier. For a complete business solution, you’ll find that many suppliers and equipment dealers can help arrange leasing for you.
Leasing is a great option for businesses looking to get the equipment they need – whether it’s to grow the business, expand into new areas or to stay up to date with new technology and development.
Anthony Roberts is the Head of Vendor and Commercial Finance for FlexiCommercial. You can read more of his finance insights on the FlexiCommercial http://flexicommercial.com.au/blog