Short on cash, but need equipment? Consider leasing what you need. Leasing equipment may be a better alternative to buying, depending on your situation and needs.
Today, leasing is common practice in business. Over the past two years, equipment leasing has risen approximately 20 percent, according to recent research by the U.S. Small Business Administration (SBA). And 8 out of 10 U.S. businesses lease all or part of their equipment, reports the Equipment Leasing Association.
Leasing is appropriate for just about any business at any stage of development. For start-up businesses with no revenues, smaller leasesthose of $100,000 or lessmay be better managed on the personal credit of the ownersif they are willing to make the monthly payments.
Comparing Leasing to Buying When you buy a piece of equipment or vehicle, you usually have to pay for it in full either by using cash or by financing the balance. After you finish paying for it, you own it.
Equipment leasing, on the other hand, is essentially a loan. The lender buys and owns the equipment and then “rents” it to a business at a flat monthly rate for a set number of months. At the end of...
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