It happens often enough that as a small business owner, you need an important piece of equipment in order to grow your business, or to advance it to the next level. However, sometimes it’s difficult to acquire that critical equipment, because you just don’t have the huge down payment which would be necessary to secure it.
In a case like this, one good alternative is to consider equipment leasing, which would allow you to acquire the equipment without having a large sum of money for a deposit or for outright purchase. Instead, you could lease the equipment for a two or three year period, paying relatively modest monthly installments, and at the end of that time, you would have the option of either leasing a new piece of equipment, or buying the one you’ve been leasing.
Purchasing vs leasing equipment
It’s usually a good idea to lease rather than purchase if the equipment you need requires frequent upgrades, or if the technology changes often. Leasing gives you the flexibility to change equipment, whereas purchasing locks you into that specific machine for a relatively long period, unless you choose to sell it. As mentioned above, leasing allows you to acquire equipment that you might otherwise be unable to procure through buying.
When you lease equipment, you are not responsible for ongoing maintenance and repairs, as you would be if you were the primary owner. On the other hand, if the equipment requires any kind of modifications or customization, you could not carry those out on leased equipment, whereas you could with purchased equipment. Also when you lease equipment, you’re not stuck with it indefinitely, as you would be if you were the owner of the equipment.
When you purchase equipment outright, it often happens that you retain that equipment until it becomes obsolete, often because no one else is interested in buying it. Leasing on the other hand, allows you to continually use the newest, most modern equipment available, for whatever business purpose you have in mind.