Acquiring heavy equipment seems a complicated task for any small- or mid-sized company. That’s because it involves a number of risks, from a major fluctuation in a budget to the possibility of a machine turning out to be obsolete.
Moreover, technology is something that evolves every day, and after investing a substantial amount in buying a gigantic machine nobody wants to buy another one, even if that is more powerful or packed with latest technologies.
In this manner, a company lacks on the grounds of technology, which would not be acceptable to any company wanting to survive in the competitive industry.
All to such situations, equipment finance is a way out. There is a wide range of flexible equipment finance in Perth options at your disposal allowing you to utilize working capital and thrive. In this post, we have culled some of the equipment finance options that probably suit businesses of all kinds.
Equipment finance is available for, but not limited to:Medical technology and equipmentAgricultural equipmentBusiness, retail and office equipmentConstruction and off-road equipmentIT equipment and softwareManufacturing and mining machineryTrucks and transportation equipmentBenefits of equipment finance
The equipment finance is greatly acknowledged for the flexibility it offers. With this financial product, you will have an opportunity to align repayments according to your cash flow. Moreover, you may be able to claim for tax deductions.
Some of the prime advantages are discussed below:
Complete financing – Business owners can finance equipment with no down payment.
Capital preservation – As one has not to buy equipment outright, thereby enabling capital preservation. The preserved capital can be utilized for other aspects of business, like marketing, research & development and others.
Risk management – The equipment finance reduces the uncertainty of investing the capital that a company needs to increase efficiency.
Elimination of obsolescence – Businesses would be able to secure machines based on improved technologies.
There is a plethora of benefits from which we have picked up only a few. You can approach a financing company to get to know the whole set of advantages that you may be entitled to.
Equipment finance options
There are a number of equipment finance options suiting your requirements. Here we have put together some of them before you.
Hire Purchase
If you are willing to buy the latest equipment or vehicle while preserving your capital, hire purchase option would be best bet for you. Under this option, your financing company buys the desired equipment and hires it to your business for agreed time duration. The ownership would remain with the lender, but you can purchase the asset outright with a balloon payment. Further, the asset is supposed to be recorded in the lender’s balance sheet excluding depreciation value.
Finance lease
This financial product allows you to get an asset with no capital investment. Under this option, the financing company would own the asset and lease it to you for determined time duration. And the rentals are structured with a residual amount. It also gives you an opportunity to claim it as a tax deduction.
The benefit of having a residual value is that your monthly payments would be so low that your cash flow is not affected.
Chattel Mortgage
The benefits of chattel mortgage are somewhat similar to those that a hire purchase has. But it provides specific GST benefits that create a fine line between the two of them.
For more information, you can approach a financing company offering equipment finance in Perth.
