How to Do Equipment Leasing the Right Way
To be able to take on a variety of projects and ensure company growth, construction businesses require access to a wide range of machinery, including cranes, bulldozers, cement mixers, jackhammers, and other equipment. However, financing to purchase everything you need may be difficult to obtain. A viable option to keep your company on the road to success is equipment leasing.
Bypass Credit Difficulties
If you’re just starting out in the industry and still building business credit, it may be difficult for you to qualify for traditional bank loans for equipment purchase. On the other hand, your company credit rating is generally not a primary factor in equipment leasing. As long as you can place a deposit and prove that you can make timely payments, your application is usually approved.
Acquiring the machinery you need is more affordable with equipment leasing. When you purchase equipment, your company is solely responsible for its maintenance and repair. However, when you rent equipment, the leasing company often assumes responsibility for equipment upkeep. If the rental payments pose a problem for your company cash flow, consider factoring your invoices to bring in the cash you need.
The purchase of equipment is a long-term commitment. Because of the considerable investment, you are forced to keep using the machinery you own even after updated models have appeared on the market. However, when you lease equipment, you can upgrade to newer models more frequently.
Access Specialized Machinery
Some projects require specialized construction equipment that you don’t frequently need. If you purchase these items, they remain idle for much of the year. Instead, you can rent them for only as long as you require their use. When the job is over, you return these items to the leasing company, avoiding the inconvenience and costs of storage.
For more information on equipment leasing, get in touch with Prime Start Capital.