Expand Your Business with Vendor Equipment Leasing
Many equipment vendors don't want to bother with financing. They figure that the customers who can afford equipment will buy and that those that can't won't.
It is correct that customers on tight budgets who can't afford the equipment outright aren't going to buy. That doesn't mean they aren't potential business opportunities. Many of these customers are leasing equipment instead of buying. If you don't have a leasing program, you could be losing quite a bit of your business to your competitors that do offer leasing programs.
Equipment Leasing vs. Buying
According to recent surveys, only 22% of businesses buy their equipment outright while the rest finance the purchase. Less than 50% of that equipment financing is done through loans. Most equipment is acquired through leasing programs.
Particularly for the small business, equipment leasing offers substantial benefits over purchase such as tax benefits and easy upgrades. It requires less capital up front so is often the only option for cash-strapped and credit-poor companies.
For the vendor, this means a much wider customer base. You can offer your products to companies you never considered before. Additionally, a lease can often mean more income over the long run than selling a piece of equipment outright. Leasing is an operating expense rather than a capital expense, so can be approved at a lower level of the organization. This means quicker turnaround on the deal.
Leasing Brokers do the Dirty Work
If you are like the typical vendor, equipment leasing isn't something you have experience with. You know how to design and manufacture the product but you probably don't have anyone on staff that is well versed in the details of financing. This means hiring a new person and maybe even creating a new department, along with all the bureaucratic headaches that come along with such a restructuring.
Instead of doing it yourself, go through a broker. Brokers handle all the picky details of matching you to the right customer, checking customer credit, finding funding sources, and setting up the lease agreements. This lets you focus on what you do best without diluting your efforts.
Leasing Income Means Regular Cash Flow
Another advantage of equipment leasing is that rather than occasional and unpredictable sales income, you now have a regular, monthly income stream. This makes it easier to plan your future finances and cover regular expenses.
Leasing lets customers upgrade equipment more frequently, and that is good for your business as well. Rather than waiting for the old equipment to die, you can sign customers to new leases on updated, and usually more expensive, equipment and increase your cash flow.
Implementing a vendor equipment leasing program brings your company an array of potential new customers and predictable income. Doing it through a broker means the program will have very little impact on your actual day-to-day operation except for the increased sales opportunities. Leasing is an increasingly popular option and there is no reason for any equipment vendor not to offer a financing program to their customers.
Author is a freelance copywriter. For more information on Equipment Leasing, visit http://www.ResourceCapitalPros.com