OVERVIEW – Information on finance lease solutions in Canada . Equipment financing makes total sense for consideration in these 4 asset categories – equipment , construction, technology/computers and software
Equipment financing in Canada might not be able to buy you happiness – but it sure makes sense to consider finance lease solutions in these 4 categories of business assets. Let’s dig in.
When business owners understand some equipment lease basics all of sudden acquiring assets in these 4 asset categories makes total sense.
1. Computers / Technology – investments in this area tend to be some of the larger financing decisions that many companies make. Whether it’s a commodity type solutions or a specialized software /hardware acquisition a lease solutions tends to make these type of assets ‘ affordable ‘. The ‘ sticker shock ‘ of total investments required can be significantly mitigated with lease pricing and structure – allowing business owners to conserve working capital and maximize ‘ return on investment ‘.
No asset depreciates faster than technology, so the ability to keep your business competitive while maintaining flexibility clearly gives you a ‘ total solution ‘ approach.
2. Software – More often than not investment in software solutions makes firms more profitable and efficient. Almost any type of ‘ application software’ can be financed. That includes license to use the product and the ability to upgrade to newer versions via a properly structured payment plan. Accounting packages as well as office software are typical items that are very financeable.
3 .Equipment /Production Assets – 80% or more of all North American businesses use, or have used asset finance leasing solutions. When business owners and financing managers combine the ease of approval, payment flexibility , as well as the balance sheet and tax benefits of asset financing more often than not, in fact almost ways, outweighs outright purchase .
And those assets for finance consideration? They include metalworking. Fabrication, injection molding / cnc, milling, and press equipment, to name just a few!
4. Construction Equipment (New & Used!) – It no surprise that in the next 4-5 years analysts advise that over 200 Billion $+ of new and used construction assets will be purchased in the U.S. and Canada. Today’s buzzword is ‘ infrastructure ‘ and these assets in mining, concrete and road equipment are key parts of that major trend.
While Construction equipt. might not be as ‘ technologically advanced ‘ as computers it’s running a close second, and traditional mechanical equipt has become very advanced while providing more cost effectiveness at the same time. Whether it’s one unit, new or used, or a fleet of assets items such as cranes, cement trucks, excavators, etc are high tick cost that can be financed at low ticket payments!
When acquiring assets in our four categories we’ve covered it’s important you’re familiar with basic terms around rates, residual values, purchase option flexibility, as well as the type of lease you’re entering into, either a capital ( lease to own ) or an operating ( lease to use ) solution .
A balance approach is important in any consideration of asset financing and acquisition. While finance lease solutions eliminate ownership (unless structured properly) and have almost no termination ability, as well as coming in at sometime a higher cost it always makes sense to consider the cash flow conservation and other flexibilities that come with this solution.
Yes, money can’t buy happiness, but business happiness when it comes to proper finance lease solutions is a distinct possibility. Seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you with proper equipment financing solutions tailored to your business needs.
Author: Stan Prokop – 7 Park Avenue Financial :
Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 – Completed in excess of 90 Million $ of financing for Canadian corporations . Info /Contact :
7 PARK AVENUE FINANCIAL = CANADIAN EQUIPMENT FINANCING AND FINANCE LEASE EXPERTISE
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