June 24, 2008
Using Equipment Leasing as a Competitive Weapon
Most great generals know how to envisage winning battle plans. They also comprehend how to use their resources to gain advantages over the contestant. For these military leaders, getting enough tanks, aircraft, ships and armaments into the hands of the right personnel can spell military victory or defeat.
In the calling arena, gaining access to certain resources and getting them into capable hands can also determine success. Many well-to-do business leaders possess discovered that equipment leasing can make a significant difference when competing in the marketplace. In fact, equipment leasing has become a competitive weapon for business managers who discern how and when to use this helpful financing tool.
Here are some ways savvy business owners and managers operation equipment leasing to gain advantage over their competitors:.
Developing a financing war chest.
Equipment leasing allows companies to finance more activities to compete effectively. It supplements other forms of financing, such as equity capital, bank obligation, trade credit and mortgage financing. Foxy business managers perceive that access to a range of useful financing affords them certain options and gives them an advantage atop competitors with fixed financing.
Maintaining state-of-the-art technology.
Being able to acquire and use state-of-the-art equipment and software can donate many companies a noticeable competitive advantage. This advantage can be particularly significant in research, consequence development, marketing and operations. Beside using equipment leasing, companies are capable to better manage technology turnover. Many managers employ operating leases to earn state-of-the-art equipment championing fixed time periods. At contract end, they are then able to rid themselves of obsolete equipment by returning the equipment to the lessors.
Stretching equity crown.
High-mindedness capital is regularly the most flexible form of business funding. It allows companies to undertake high-impact growth activities like adding key personnel, conducting research and development, and expanding marketing programs. Equipment leasing is dedicated financing. It permits companies to add equipment efficiently. In this context, equipment leasing helps to leverage and extend a company’s equity head by freeing it up for other uses. When used properly, the overall impact of equipment leasing is to leverage equity returns. High equity returns draw investors and permit companies to source more tolerance head in the future.
Equipping skilled persons to engage in battle.
Using leasing to get the best software and tools into the hands of talented personnel is a competitive advantage. Companies that quickly get equipment into the hands of talented workers at every level usually conflict more effectively in the marketplace.
Accelerating fellowship cultivation.
Equipment leasing facilitates faster company growth. It allows companies to add infrastructure faster by bringing in equipment earlier and paying over time. In this regard, leasing affords a competitive advantage over companies that linger to purchase equipment unequivocal.
Defending working capital.
Underhanded responsibility managers have discovered how to preserve pressure off of their companies’ working capital. Compared to outright purchase, equipment leasing has a low impact on working capital. Leasing allows companies to avoid large upfront outlays while spreading equipment obtaining costs over an extended period. Using equipment leasing to manage working capital permits companies to remunerate bills on time and to operate smoothly. They are then able to gain a competitive advantage over companies that have not mastered this technique.
Maximizing tax benefits.
Sophisticated companies are able to improve tariff benefits by carefully using equipment lease structures. Alongside entering into operating leases and being able to fully withdraw lease payments, companies that can’t otherwise use depreciation write-offs can even realize tax benefits. Head leases allow companies that can use depreciation write-offs to take advantage of this feature. Tax benefits further limit the cost of acquiring equipment. These benefits can often make equipment leasing a more efficient means of acquiring equipment compared to other methods.
Turbo-charging equipment sales.
For companies selling equipment, offering equipment leasing to customers at the point of selling can help establish a significant competitive advantage. Serviceable equipment financing at the point of sale can eliminate a major selling challenge- the customer’s lack of financing for the purchase. Equipment sellers offering leasing turn their customers a means of acquiring the equipment and realizing the full benefits of equipment leasing. This sales-financing strategy represents a clear advantage over sellers who let customers fend for themselves.
Savvy business owners and managers understand the benefits of equipment leasing. They also understand how to accomplishment leasing for competitive advantage. The challenge for them is to optimize leasing to realize the biggest gains and to compete more effectively. It is no wonder that equipment leasing in the u. Has grown to over $ 240 billion annually and accounts representing more than 30% of equipment acquisitions. Consider equipment leasing when designing your battle plans. Don’t allow your competitors to use leasing against you to win the conflict in your market.
George parker is a director and executive vice president of leasing technologies international, inc. (”lti”)(”lti”). He is responsible championing overseeing the company’s marketing and financing efforts. One of the co-founders of lti, mr parker has been affected in secured lending and equipment financing representing over twenty years. Mr parker is an industry leader, frequent panelist and author of several articles pertaining to equipment financing.
Headquartered in wilton, ct, lti is a leasing inflexible specializing nationally in direct equipment financing and vendor leasing programs representing emerging flowering and later-stage, venture capital backed companies. More information about lti is available at “_new” href=www www. .
