If your money is not tied up in equipment costs, you’re free to spend it on other items such as inventory, advertising, research, development and personnel.
BENEFITS OF LEASING
FREES UP CAPITAL
FIXED PAYMENTS
Lock in payments – facilitate financial planning with stable payment structure.
LESS "RED TAPE"
Additional equipment can be acquired without renegotiating existing loan covenants. Leasing is a fast, convenient alternative to borrowing or crossing your fingers and waiting for a windfall.
ENJOY FLEXIBILITY
Longer terms, lower payments structured to fit your budget. Leasing is the least restrictive form of financing today.
USE OF EQUIPMENT
Cost-cutting profit-making equipment installed immediately. Access to the equipment your need, when you need it, in order for your business to grow and prosper. Pay as you use!
TAX SAVINGS
Payments on qualifying leases are written off as direct operating expenses, reducing taxable income. Avoid negative impact of the alternative minimum tax or mid-quarter depreciation penalties (please consult your tax advisor).
ENHANCED CASH FLOW
You pay only for the use of the asset, not it’s ownership. This makes for easier cash flow forecasting.
CREDIT DIVERSIFICATION
Your bank lines are not burdened. Gives you leverage – leaving normal lines of bank credit undisturbed. Avoid restricting your ability to respond to opportunities and emergencies.
OFF-BALANCE SHEET SOURCE OF FUNDS
Experience more liberal credit criteria as there is no disturbance of your current debt ratio. Improve ROE/ROA and other ratios so that you may improve your ability to acquire funds.
AVOID CAPITAL BUDGETING CONSTRAINTS
As lease payments generally come out of working capital, they do not affect your borrowing power for larger, capital items and do not diminish your debt to equity ratios.