Investment is an essential facet of company growth and nothing frustrates business owners more than being unable to take advantage of an expansion opportunity due to limited capital.
Whether you're looking to add to your fleet of vehicles, purchase new tools or equipment, or simply need to replace outdated machinery, the large upfront costs involved can be a stumbling block that many businesses struggle to overcome.
Fortunately, help is at hand with industry-focused lenders offering their own unique financial products specifically designed to help businesses make those essential equipment purchases.
Read on to learn more about the most common finance options available and find a funding partner that can help your business grow today.
Asset finance is a fantastic borrowing option which has been specifically created to help businesses purchase new and second-hand equipment. It can also be used to secure additional borrowing against assets which you already own.
The term 'asset finance' is used to cover a range of different finance solutions, all of which can be used to help you access essential equipment for your business. You can read more about the most common types of asset finance below.
Hire purchase is an ideal solution for businesses who wish to spread the costs of purchasing new equipment over a fixed number of months or years. Rather than being saddled with a hefty, upfront payment, you'll simply pay a small deposit at the start of the agreement and repay the remaining balance over a term of between 1-5 years. As soon as the agreement is in place, the equipment you've purchased will appear on your company balance sheet and, at the end of the agreement, you'll own the asset outright. Read more about using hire purchase to upgrade equipment without upfront costs.
A finance lease works in a similar way to hire purchase however, as the name suggests, you'll be leasing the product rather than purchasing it. Many commonly used tools, equipment and machinery have a short economic life span and it can therefore be very costly for businesses to purchase these outright only to replace them a few years down the line. With a finance lease, you'll have full use of the asset without the responsibility of ownership. At the end of the term, you can either choose to continue leasing it (usually at a reduced rate) or instruct your lender to sell it in order to recoup some of your rental payments.
If you're looking to purchase new vehicles for your business, then contract hire could be the perfect answer. Rather than purchasing new vehicles, they can be leased for a fixed monthly price over a pre-determined number of years. They're great for businesses who need the flexibility of being able to increase and decrease the number of vehicles within their fleet, and for those who don't wish to deal with the hassle of selling disused vehicles further down the line.
An operating lease can be a useful ally for businesses which find themselves regularly replacing or upgrading their equipment. Rather than purchasing an asset, using it, and then selling it when it's no longer needed, operating leases allow you to rent the equipment and use it for its economic life. At the end of the agreement, you can either continue renting the equipment from your lessor, return it, or replace it with a more suitable version under a new operating lease.
If you're looking to raise finance to support the purchase of new equipment for your business then help is at hand.
Capitalise has brought together more than 70 mainstream, independent and niche lenders who specialise in supporting businesses with their asset acquisitions. Whether you want to own the equipment outright or simply lease it until the end of its economic life, our comparison service can help to match your business with a finance partner in minutes.
Our efficient, intuitive system allows you to make simultaneous applications to vetted lenders that you've been matched with, helping you to quickly and easily find the most cost effective solution for your needs.
You can even invite accountants and other financial advisors onto your Capitalise platform to help expedite the application process.
Match your business with potential lenders today by clicking on the sign up option below and discover how asset finance can add value to your business.