We’ve shown previously in this blog that investing in the right IT equipment can reduce costs throughout a business and even protect against unplanned costs and financial threats. But, how is investment in these products possible with limited budgets or little capital? Well, there are many options for a business to fund new equipment; a popular choice is asset finance and leasing. In fact the Finance & Leasing Association recently published findings that showed a 10% increase in IT equipment finance over the previous year.
1Manage Your Finances
When purchasing IT equipment outright, there are no regular payments or interest rates to be concerned about; however it does mean investing a potentially large amount of capital up front.
Our experience shows that many organisations are trying to avoid this type of capital investment as it removes the element of flexibility in the cash flow. And a practical solution is asset leasing, which requires no capital investment.
By avoiding the need for investment, cash flow can remain fluid and capital can be used for other business needs. In addition to this, asset leasing will mean that set monthly payments can be arranged and factored into monthly outgoings. There will be no surprises or unexpected costs, meaning you can plan and budget with 100% accuracy.
At the end of the agreed lease, the equipment can be collected by the leasing company and the latest equipment put in its place (with a new lease). With an operational lease, the leasing company is always the owner of the IT equipment, and the benefit of this is that it takes responsibility for the residual value. When the product/equipment reaches the end of its operational life, you don’t have to worry about selling it on or recycling it, you simply have it removed from your premises, and its replacement installed.
An organisation has become aware of a new type of PC that will revolutionise their operation, but they need 500 units. As part of an industry-leading service, some leasing companies will actually help businesses source the equipment they need in order to ensure they get the best price and service.
In addition to this, leasing agreements can be created to include servicing and maintenance responsibilities from the leasing companies. This means that a business can use the guidance and services of a leasing company to source the IT equipment they need, and also rest assured that the servicing and maintenance will not be their responsibility (giving them peace of mind).
3Taking The Lead
Having the latest equipment and tools (among other things) can give a business an edge on their competitors and even help motivate employees who desire, or even demand, the most up to date hardware and software be at their fingertips. With more and more complex material on-line or streamed in, an employee with a clunky, slow and ageing laptop/desktop may be as frustrated as a stereotypical salesperson with an old, high mileage company car. The fact is that a typical laptop has a useful life that is much shorter than a vehicle; after a couple of years it may be obsolete.
For organisations that have bought their IT equipment outright, they may need to continue using ageing equipment in order to justify the initial investment which makes it rather difficult to stay up to date.
This is certainly not the case for businesses that have taken advantage of IT equipment leasing. These companies are able to complete a lease and upgrade to the latest top tech with minimal fuss – obsolescence becomes a thing of the past.