Commercial leasing & finance

If you’re looking to upgrade your business’ assets or replace outdated technology without the responsibility of owning the assets outright, then commercial leasing could be the solution for you. With the right provider, your business can gain access to high-value assets without impacting your cash flow.

What is leasing?

Commercial leasing is a form of asset finance similar to hire purchasing. Rather than purchasing an asset; machinery, IT or vehicles, a leasing provider purchases the assets and leases them back to your business. You may have to pay an initial deposit before receiving the asset, followed by monthly repayments tailored to what you can afford. At the end of the lease period, the asset returns to the lender. At which point, you may have the option to start a new arrangement with an updated asset or make a ‘balloon payment’ and buy the asset from the lender.

This method of paying in monthly instalments and strengthening of your credit rating makes leasing an attractive option for small businesses and start-ups.

More information on asset finance

Advantages of leasing

• Access to better assets. The latest equipment can be expensive to buy outright. Leasing means your businesses can gain access to these assets without such a substantial impact on your cash flow and grants you an edge over your competitors.
• Keeps your business up to date. Once your arrangement ends, you can upgrade your currently leased equipment for a newer model, ensuring your assets won’t become outdated overnight; helpful if you regularly change your equipment.
• Lack of asset ownership. Not owning the asset outright can put you in a better position should something go wrong; many lenders provide maintenance if a fault occurs. Owning an asset also means it will depreciate the longer you have it. Leasing negates this as you return the asset to the lender once your arrangement expires.
• Tax benefits. As leasing costs are a trading expense, you could deduct them from your taxable profits.
• Better for cash flow. Your business’ cash flow is its lifeblood, and costly purchases can negatively impact it. Leasing removes the initial expense of purchasing new equipment and keeps your cash flow moving; the regular payments could even strengthen your business’ credit rating.

In summary

Commercial leasing allows your business to lease modern assets such as machinery, vehicles, and computer equipment. Doing so removes the burden of initial purchase costs and can help you stay competitive while helping your cash flow. It works like hire purchasing, although at the end of the arrangement, the business will not own the asset, making it easier to switch to a newer model. The process can be beneficial for start-ups and businesses without the capital reserves to make large purchases.

How we can help

If you’re looking for a cost-effective way of keeping your equipment up to date while benefitting your cash flow, contact us today. We have years’ experience in the industry and well-established relationships with a range of funding partners. Our initial advisors are on-hand to provide you with free, impartial advice, and help you decide the best route forward for your business.

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