How To Leverage The Advantages Of Equipment Financing In Your Business

At some point in your business’s life cycle, you may need to invest in pricey equipment to ensure that it’s competitive. Yet, few small businesses have the cash flow to pay for such big-ticket needs out of pocket. Equipment financing is designed to make those large but necessary purchases more financially feasible for small businesses.Here’s what you need to know:

What Is Equipment Financing?

In its most general sense, equipment financing is a type of specialty financing that empowers small businesses to fund up to 100 percent of the cost of equipment they need (which can range from machinery to technology to vehicles) without requiring that they lose access to cash flow in the process. How much you can finance depends on a variety of factors, including your sales volume and the cost (or value) of the equipment you’ll purchase.

Potential Advantages of Leasing Equipment vs. Equipment Financing

You may often hear of the potential advantages of leasing equipment for your business when it comes to preserving cash flow, but equipment financing allows the best of both worlds: You maintain liquidity and invest in an asset you’ll one day own.While there can be some advantages of leasing equipment for your business if you’re experimenting with a new product line or are unsure of your future strategy, remember that you won’t own the item once the agreement ends.If you intend to use the equipment you’ll finance to support your business for years to come, equipment financing allows you to gradually make small payments toward collateral that ultimately builds your company’s value.

Benefits of Equipment Financings

Here’s a look at the some of the specific benefits of equipment financings:

Ready to experience some of the benefits of equipment financing in your business? Answer a few simple questions on our Lendr site to get started.