Different businesses require different equipment and machinery to get the job done. In particular, the trucking and transportation industries. These pivotal businesses not only transport raw materials to producers, fabricators and developers of all kinds, but are instrumental in transporting food, fuel, water and other goods to global markets.
As a result, specialized equipment is often needed to transport specific types of goods or products. Semi-tractor trailers, fuel trucks, refrigerated trailers, and heavy duty haulers, dump trucks, and construction equipment are all expensive pieces of equipment that your company will need in order to get the job done on time. Sometimes because of the costs associated with these pieces of equipment, outright purchasing of new or used means of transportation isn’t applicable – a transportation equipment leasing agreement may be the right option for your business
What Are the Benefits of a Lease?
Leasing provides many positive perks for businesses looking to enlarge and update their fleet of transportation equipment. Leases often require either a low – or no – downpayment, making their access to the right equipment that much easier. This allows a business to operate better, newer, and potentially more fuel efficient vehicles and trucks without having to part with a considerable amount of capital. You’ll also pay fewer sales tax.
Further, leasing alleviates the pains of having to repair these vehicles. Many leasing agreements keep the borrower under the vehicle’s included factory warranty for most manufacturer defects and required repairs.
At the end of the leasing agreement, the business can easily transition into a new fleet every two or three years. New vehicles mean up-to-date technology, reduced insurance, increased fuel efficiency, increased reliability, as well as improved visual aesthetic for businesses looking to hire transportation expertise.
In a nutshell, leasing is a quick and painless way to flexibly upgrade or expand a business’s equipment needs. Predictable lease timelines translate into predictable timeframes to recoup costs and adjust accordingly. This future-proofing mentality covers the need for company growth without the full-scale commitment of having to recoup inflated spending outright.
Leasing also comes with the benefits of potential tax savings over a traditional purchase. When you lease equipment it is possible to deduct – often in full – the monthly cost as an operating expense. With a traditional purchase or finance agreement, the equipment will depreciate in value over time. It’s important to note that leasing what depreciates is a superior option than outright buying something that depreciates. As vehicles depreciate, leasing remains a stable and sound financial decision.
These savings amount to increased liquidity for a business, conserving your capital to be allocated to other important aspects of your operations. This could help to pay for the insurance of a fleet of trucks or construction machinery. There’s also the possibility of hiring additional staff to operate your equipment.
Leases are extremely flexible and manageable agreements because they provide businesses with access to greater working capital and easy equipment upgrades. Through appropriate forecasting schedules and accurate growth channels, leasing can prove to be a valuable tool in your arsenal for quick and exciting company growth.