He has over 25 years of experience in both sales and account management. He has developed relationships with some of the largest companies in Canada, in all sectors including construction, hospitality, healthcare and the golf industry. You can also add installation, maintenance, and other services to your lease. Benefit: You can create a program that fits your cash flow, budget, transaction structure, and cyclical fluctuations. You may use the leased equipment for specific periods of time at fixed payments.
The lessor assumes and manages the risk of equipment ownership. Benefit: At the end of the lease, the lessor is responsible for the disposition of the asset. Benefit: You will never get caught with obsolete equipment and you can upgrade or add equipment to keep up with the competition. You can respond quickly to new opportunities with minimal documentation and red tape. Typically, your lease will be approved within one or two days. You will always know the amount and number of lease payments.
At the end of the lease, you can return the equipment, renew the lease, or purchase the equipment. Although ownership is perhaps the biggest advantage to buying business equipment, it can also be a disadvantage. If you purchase high-tech equipment, you run the risk that the equipment may become technologically obsolete, and you may be forced to reinvest in new equipment long before you had planned to.
Certain business equipment has very little resale value. When deciding whether to buy or lease a particular piece of business equipment, try to figure out the approximate net cost of that asset. Be sure to factor in tax breaks and resale value when making this calculation. After determining which option is more cost-effective, consider other intangibles such as the possibility that the product will become obsolete if you are considering purchasing or that your need for the product will expire before the lease does if you are considering leasing.
If you are considering a car lease, see Leasing a Car to learn about the advantages and disadvantages of car leasing. Steingold Nolo. The information provided on this site is not legal advice, does not constitute a lawyer referral service, and no attorney-client or confidential relationship is or will be formed by use of the site.
The attorney listings on this site are paid attorney advertising. In some states, the information on this website may be considered a lawyer referral service. Please reference the Terms of Use and the Supplemental Terms for specific information related to your state. Grow Your Legal Practice. Meet the Editors. Business Equipment: Buying vs. Decide whether to lease or buy by learning about the pros and cons of each.
Leasing Equipment Leasing business equipment and tools preserves capital and provides flexibility but may cost you more in the long run. Advantages of Leasing Equipment Less initial expense. Disadvantages of Leasing Equipment Higher overall cost. Leasing provides companies with the ability to keep pace with technology.
The lessee can upgrade or add equipment to meet ever-changing needs. Specialized Assistance. Lessors are specialists in equipment leasing and financing, and understand capital equipment markets. There are a variety of leasing products available, allowing the lessee to customize a program to address needs and requirements - cash flow, budget, transaction structure, cyclical fluctuations, etc.
Proven Equipment-Financing Option. Over 30 percent of all capital equipment in the United States is acquired through leasing.
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