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Reasons for Leasing for Business - Why Equipment Financing Works!

Guest post by: Stan Prokop

Article Overview: Information on equipment financing in Canada and reasons why leasing for business makes sense from a viewpoint of cash flow management , quick approvals, and other financial benefits . Why Your Business Should Consider Leasing Equipment

Reasons for Leasing for Business - Why Equipment Financing Works!

Reasons... and facts. That’s what Canadian business owners are looking for when looking for equipment financing. And quite frankly leasing for business has never been more popular, and made more sense.

Let's examine some of those reasons and facts to ensure you are well informed when you are looking to acquire capital assets for your business. And by the way, capital assets sure is a broad term, because it covers technology , plant equipment, business equipment, rolling stock, even your corporate jet .. (We know ' you wish ...').

So why are hundreds of millions of dollars, probably billions of dollars leased in Canada every year under an equipment financing strategy? It all comes down to a common saying among leasing people, which is simply that you generate profits and sales by using assets, not owning or paying outright for them .

The good news about leasing for business is that the key word is flexibility - credit approvals are more flexible, cash flows can easily be structured to meet your needs, and various balance sheet and tax benefits accrue to companies who lease.

We find in talking to clients looking for innovative lease financing options that we can talk all we want about off balance sheet, tax benefits, depreciation strategies, etc - but, at the end of the day they are simply concerned with getting credit approval and conserving cash. Otherwise of course these assets must be purchased out of bank lines that have already been tightened by your bank.

When we talk to companies that are using effective equipment financing strategies we find, more often than not, that they are simply ahead of their competition in innovative assets that drive revenues and profits. That’s simply of course because there is no huge outlay of capital when acquiring these assets, which more likely than not are depreciating anyway.

Don’t forget also that taxes are paid as part of your monthly installment when are leasing for business assets - a classic working capital conservation strategy. The bottom line is that your firm can grow when you have the ability to conserve cash flow and use it for operating needs and further re investment.

It sometime is difficult for business owners to determine who the right leasing partner is. There are hundreds of firms, many are in fact not Canadian, and all firms have different credit, deal size, and interest rate policies related to how transactions are structured. If you are looking for a quick way to navigate the entire equipment financing marketplace in Canada speak to a trusted, credible and experienced Canadian business financing advisor who will assist you in completing a transaction that makes sense and achieves the approval and benefits your firm is looking for.

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Article Tags: equipment financing, leasing for business



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Equipment leasing - Equipment leasing has many benefits, such as tax benefits, conserving money and always having up to date equipment to stay competative to name a few. Obviously, it's partially dependent upon what type of business you have as to whether you will benefit more than someone else but... Do you think it's worth leasing your equipment rather than purchasing it? Can you think of any other reasons you can benefit from it or any reasons this is not a good idea?
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