You’ve performed your due diligence and decided that obtaining a certain piece of equipment will bring undeniable benefits to your business. Those benefits might include streamlining or improving your processes, increasing employee or operations productivity, innovating your product or service offerings and ultimately boosting your bottom line.
Making an investment in the equipment to take your business to the next level also usually takes a substantial investment, which can have an immediate and/or long-term effect on your cash flow. To mitigate or offset financial risk, your approach to equipment lease financing matters.
The time invested in creating a strategic approach will not only help ensure you get the equipment your business needs, but also help you avoid costly mistakes.
Let your answers to the following questions help guide your approach to financing an equipment lease and move your business forward.
What is your expectation for financing an equipment lease?
We listed some in the first paragraph. Maybe those apply or perhaps there are more reasons, such as staying ahead of competitors, evolving with the marketplace, etc.
By having realistic expectations, you’re less likely to accept the wrong equipment lease financing for your budget and situation. You’re more likely to assess payment and terms compared to benefits gained and return on investment.
READ: Should You Finance a Lease or Raise Equity to Acquire New Equipment?
Are you too close to the situation to make an objective decision?
When the investment in new equipment is on the cheaper side, a mistake can be absorbed pretty painlessly. Chalk it up to live and learn. But often Global Financing & Leasing Services (GFLS) works with business owners who are investing thousands or hundreds of thousands of dollars in financing an equipment lease. Leasing the wrong equipment for your business goals is a costly mistake with potentially serious business consequences.
The bigger the equipment lease finance payment, the more important it is to vet your options. What separates GFLS from other equipment financing providers is that our team provides objective advice and best-in-class service. Our clients have grown to trust our insights in their industry, and we can help you determine how financing new or upgraded equipment leases might impact your capacity, efficiency, competitive advantage and sales.
How does the new equipment fit into your overall operations?
Will your new equipment fit your needs right now or in the long run? Equipment financed for your long-term goals can come with additional costs in the short term in areas like training and peripheral investments in marketing in order to achieve maximum return on investment.
For example, medical equipment. Will your staff require training? Are there any software purchases, subscription fees or supply costs involved? Will patients need education on the equipment’s value to their health? In other industries, billing, manufacturing, shipping/receiving costs may be considerable factors.
Can your customers and finances tolerate a learning curve?
Considering what having the newest or upgraded equipment can do for your business, it’s understandable to be so excited that you underestimate the learning curve. Any equipment that will innovate your business is going to come with a learning curve for your employees, and maybe even your customers.
Make sure your customers and finances can tolerate the cost of downtime or temporary decreased productivity while your team gets up to speed.
READ: Test Your Knowledge on the Unexpected Benefits of Financing Equipment Leases
If new financing a lease on new equipment is out of reach, have you explored used alternatives?
Your finances may hinder your leap to the latest and greatest piece of equipment on the market. But that doesn’t mean you have to give up on your business goals. Consider taking an incremental jump in productivity or innovation. Taking a smaller step can sometimes boost sales to the point where you can more quickly afford to finance a lease for the equipment on which you originally had your mind set.
The GFLS team has expertise in equipment leasing across many industries. It’s worth your time to talk to us about all your options so you can obtain the equipment your business needs to grow while avoiding a costly mistake.