Equipment leasing features more advantages than purchasing with cash, and is therefore the perfect financing solution for a start-up business. Businesses which rely on cutting-edge technologies require the latest computers, equipments and other communication devices to retain their success, and leasing is really an advantage for them. With most of the latest equipments requiring periodic upgrading, it is more affordable for companies to have leases for equipments incorporating yearly upgrades than buying the equipments every time.
With the end of the lease, the lessee can return the equipment to the lessor. But when you buy the equipment you are burdened with selling the equipment if it is outdated. Usually leasing services offer flexible payment plans suiting your operational requirement which allows balancing of the cash flow. Moreover, leasing is a better choice for computers and high-tech devices which are expected to get outdated faster.
With equipment leasing no down payment is required and only one or two installments have to be paid earlier which make up to just 5 or 6 percent of the total cost. Equipment leasing being inflational friendly, the lessee has to pay only the same interest even in long term leases. The major advantage of leasing is that it allows access to the most advanced equipments without having to invest the total amount.
Equipment leasing is an ideal solution for diversifying and start-up companies, as they get to acquire equipments without huge initial investment. Some equipment has to be upgraded periodically and most companies can not afford these costs. But with leasing, the lessee has the option to structure the lease plans integrating upgrading and maintenance services if necessary.
For leasing equipment make sure that the lease period is not longer than the lifetime of the equipment and that the total rent paid for the lease is not more than the buying cost. Your business stands to gain from a good lease agreement. The payment made for the lease is also tax deductible. With leasing services, your business can get access to all the high end equipments with less investment.