A hole in your leasing finance sidewalk? It’s an interesting play on words around a current popular book making the rounds. We thought it was a neat analogy for Canadian business owners who want to make the most out of a lease finance company strategy… but instead keep making the same mistakes when it comes to being successful in equipment financing.

In essence their equipment lease strategy becomes a hole in their business, and managing what might seem like a complex process leads to that ‘ hole in the sidewalk ‘.

So how does one fix that hole? It’s simply by focusing on taking control of your lease strategies and maximizing all the benefits around the financing of the assets in your business. It’s kind of about working smarter, not harder.

We of course can forgive the average Canadian business owner and financial manager for thinking that anything to do with a lease finance company might seem complex. Naturally we all cant be experts in every field, and we met hundreds of firms over the years who utilize a lease finance company for asset acquisition but constantly either make the same mistakes or don’t consider issues they need to think about .

Probably the best advice we give to clients when it comes to the entire process of equipment finance is that they should try and view the whole process as a journey.

What does that journey involve? Well it becomes a situation wherein you have to pick the right partner firm evaluate the right type of lease for your needs, and then work through credit approval, documentation and final funding.

And just when you think its over, guess what, it isn’t. That’s because one of the greatest ‘ holes in the sidewalk ‘ for Canadian business owners utilizing equipment finance is the whole issue of end of term, i.e. the bank end of your lease transaction.

What then does the Canadian lessee need to consider? He or she clearly wishes they could eliminate some of those financial ‘ holes ‘.

To do that you need to either understand yourself, or bring in an expert on who are the real players in the Canadian marketplace. Leasing assets in Canada is clearly firing on all cylinders these days, and knowing who do deal with is critical.

You also want to understand how lessors make their money. Of course there is the implied interest rate in your transaction but issues such as down payment, residual values, etc play a key role in your overall financial success on the transaction.

Is leasing always the best choice? It might not be, especially in certain key areas such as a sale leaseback transaction, where a term loan might make more sense for a variety of reasons.

Wasn’t there a Beatles song on SGT PEPPER called ‘ FIXING A HOLE ‘? Consider doing that, financially speaking, and seek and speak to a trusted, credible and experienced Canadian business financing advisor who can help you meet leasing finance needs in Canada.