Published January 08th, 2016
If you’re a startup or you’re expanding your store, you have a lot to consider as far as what equipment you’ll need and whether you’ll lease or buy. To reach the best decision that makes the most sense over the long term, you’ll need to consider more than just the costs of buying or leasing. You’ll also need to consider the costs involved with maintenance, and if there is flexibility in the event you expand or your needs change. There is also the matter of tax deductions. Continue reading this post – more of what you need to know about equipment leasing vs. buying will be covered right here.
What type of equipment do you need?
After you decide on the types of equipment you’ll need to do business efficiently, the next step is thoroughly considering each option, and finding the best company to deliver those solutions.
To find business solutions that help you with the payment and checkout process at your business, you may consider the following equipment leasing rental options:
What is equipment leasing?
- Credit card processing swipe machine
- Check processing and imaging
- Point-of-sale systems
Businesses can lease nearly everything for their operations – and those that don’t have a lot of capital initially may benefit from this option the most. For a cash-strapped company who needs to hit the ground running, leasing offers a way to keep more cash on hand while still building the needed momentum at the storefront.
Equipment leasing works because instead of paying a large sum in the beginning, the business essentially rents it for a fixed monthly rate for a certain number of months. When the lease expires, the decision can be made to either purchase the equipment at the predetermined amount – or in many cases fair market value – or the business can choose to continue the lease agreement, return the equipment, or change the equipment that is leased.
Each company will do things a little bit differently, so it’s important to make sure you understand all the details before entering in the agreement with an equipment leasing company.
How to Find the Best Deal in Equipment Leasing
Check out the best equipment leasing companies
for January 2016. We vet companies based on several factors which are explained later on in the post. The goal is for you to find a company that works for your business model, and the list that’s linked above is a great tool to help you land on the right choice.
It’s a good idea to call around to find the best quote for your business – and it doesn’t hurt to let the companies know that is exactly what you are doing. The goal is to get the most competitively priced quote that makes the most sense.
A good tip is to make sure you’re dealing with a company that has the expertise needed to give you the services you need over the life of the lease. Looking at the company ranking, customer ratings, and client retention rate will be a huge indicator of the type of service you can expect when you begin your agreement.
When it comes to looking over the terms in the agreement, you’ll want to pay close attention to the casualty insurance. Understand what it covers in the event equipment is damaged, who is responsible for repairs, as well as tax-related information.
When it Makes Sense to Lease
For those of you who like to stay on top of the latest that technology has to offer in security and efficiency, you’re
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Equipment Leasing Options[/caption]
going to like that leasing offers a little more flexibility than buying. There are some serious benefits to leasing, and here are a few:
Keep your credit line open.
For many businesses, leasing offers a much more attainable way to get the quality of equipment they really want. Having quality equipment – especially in your point-of-sale equipment – can save you time and money. Leasing offers the better alternative over a loan for many businesses because it helps you get the equipment you want without using your line of credit.
While leasing works for most any business no matter what stage they are in, a startup will likely have to use personal credit to secure the lease.
Leasing means lower costs in the short term.
Leasing makes budgeting much simpler, because you won’t have that large sum to pay up front and you’ll know exactly what to expect every month. However, keep in mind that leasing will likely result in paying more over its course.
Save on taxes.
You can typically deduct your lease expenses as business expenses and save on your taxes.
Upgrading is easier when you lease
. Because technology is ever-evolving, it is nice to know that with leasing you have some flexibility when you want to upgrade. If you choose to buy, the equipment is yours, but after only a few short years the equipment begins to age and becomes outdated. When the lease expires, you aren’t stuck with that old equipment – you can choose something else you have your eye on.
How to Find the Best Equipment Leasing Companies
We look at a variety of factors when we determine which companies offer the best choice to small businesses who are looking at equipment leasing.
Is customer service strong?
Because the equipment used is needed to run the everyday aspects of business, equipment leasing companies should have strong customer support services. That’s why we look at how fast issues are responded to and how current clients feel their needs are supported. One of the most telling ways we can determine that is by looking at the client retention rate.
All of the top businesses on our equipment leasing company
page for January will clearly show what this number is. Companies with strong customer service are available when you need them with knowledgeable support to help you get fast resolution.
Do they have a good system of implementation?
We look at the system of implementation that equipment leasing companies have to make sure that the right services get accurately instituted. If equipment and software is improperly implemented, the performance of the equipment will be negatively affected. We ensure companies have a strong track record and are organized through the process of implementation.
Does the equipment leasing company provide high-quality options?
As a business owner who is looking for quality options that will provide reliability in service through each day, you’ll need a company that stays on top of this aspect. Unfortunately, if equipment is low quality, you can face serious implementation and usability issues across the board, so that must be a consideration during our ranking process.
Along these lines, we ensure that each company we rank is known for stocking high-quality equipment and that it is available. It’s important that the equipment leasing provider has the access needed to offer the latest upgrades and can provide you with those options in a timely way.
Many of our top rating companies also provide the following types of services:
- Point of Sales Systems
- Equipment Leasing
- ATM Machines
- ACH Processing
- Credit Card Processing
- Mobile Processing
As you consider the pros of leasing, remember the following benefits as you make your decision:
- Leasing is a beneficial choice when you want flexibility to update your equipment. By working with your leasing company, you often can get ahold of the most updated options in technology without putting up large sums of money to make it happen. Contrast the upgrading options with buying that leaves you with outdated equipment, and it looks like the better option.
- Because you won’t have to put a large sum of money up front to pay for your equipment, you can budget for other needs that come up. You’ll free up more of your credit line to make those other needed purchases and have the available cash flow.
- Under IRS tax code, leasing is tax deductible as an operational expense.
- Leasing offers flexibility with the amount of options available to you. Because you aren’t held back by the upfront costs, you can choose higher quality equipment that can benefit your business with efficiency and even save on administrative costs.
- When you lease, maintenance is often covered within the agreement. You won’t need to worry about normal wear and tear.
Here are some things you need to look at for in terms of leasing:
- As you are leasing, you won’t own the equipment. In the event you wanted to sell the equipment to get some fast equity, that isn’t an option when you lease.
- Make sure that the length of the lease is something that makes sense for you. If you want freedom to upgrade, for instance, make sure that this option is available to you. Also, you want to make sure that you’re not locked in with equipment you won’t need.
- Find out what the specifics are as far as maintenance and repairs. How long will it take? Are there any costs involved? Read the fine print before you make your final decision.
- As mentioned earlier, companies who lease should give you options – do they have what you want in stock? If not, it may be time to check out another business.
Get ready for all the potential business of 2016 and find the equipment you need to meet the demand in style. Check out our top 10 list of best equipment leasing companies
and get started!