5 Ways to Improve Your Small Business by Leasing Equipment
As a small business that is just getting started, your capital can get used up pretty quickly. Between purchasing inventory and paying salaries and overhead costs, finding cash to purchase equipment, whether it be new or used, can be difficult. One option is to consider leasing business equipment. There are many benefits to leasing equipment instead of purchasing it and some of these benefits can help to improve your business.
- Increase Available Capital
When you lease equipment, you do not need a large sum of money to acquire the equipment. Instead, you sign a contract that sets fixed payments. This increases the capital you have available to improve your business. This could mean you have more freedom to advertise your business, expand your market or hire additional employees.
- Use Top of the Line Equipment
Purchasing equipment can lead you to being stuck with obsolete machinery. Leasing business equipment allows your business to upgrade to top of the line equipment at the end of each contract. This keeps your business competitive with the best technologies available.
- Write Off Lease Payments
For tax purposes, lease payments can often be written off as an operating expense. This could benefit your small business in its tax return by either reducing the amount owed or increasing the amount refunded. Of course, you should consult with a tax expert on how leasing could benefit your business.
- Modify Payments to Your Business
Each business is different. For some businesses, there are specific times of year that are more lucrative. Leasing business equipment does not have to have monthly payments. When negotiating the terms of the contract, you can choose to make payments monthly, quarterly, semi-annually or annually. This allows you to make payments when cash flow is more readily available.
- Lease All Equipment
From computers to heavy machinery, any type of business equipment can be leased. Often, there are benefits available to businesses that lease multiple pieces of equipment. There are also master leases available that allow additional items to be added on to an existing lease in the event of business growth.
Leasing business equipment has many benefits. It can allow your business to have more available capital, access to top of the line equipment, tax benefits, flexible payment plans and the ability to lease any equipment. If you are looking for ways to improve your business and increase its productivity, you should start by leasing necessary equipment.