Buying can be quite costly due to the constant development of technology and new equipment. Equipment leases are viable for business owners with limited capital or whose equipment should be upgraded every few years. They’re an efficient way for companies to remain on top of their industry’s development curve. This article outlines six benefits of leasing medical equipment.
1. Fewer upfront costs
Equipment leasing lets you spread out your purchase cost over time. Instead of a huge one-off payment to own the equipment, a leasing program demands an affordable down payment, followed by monthly payments due to the leasing company to keep using the equipment. This flexible payment alternative makes leasing an attractive financing option for most business owners.
For instance, if you own a medical lab, microscopes may become costlier if they have more lenses, complex eyepieces, and objectives. Additionally, purchasing the highly specialized microscopes outright can be difficult due to the large down payments required. For lab businesses, for instance, with a microscope rental, labs of all sizes and budgets, especially start-ups working on limited budgets, can conserve their working capital to reinvest in critical operations.
2. Conserve working capital
Equipment leasing allows you to save your working capital for daily business expenses, expansions, interest payments and taxes, and other unexpected business expenses. Leasing also gives you a predetermined monthly item, making your budgeting more effective.
With a predictable monthly budget, you can confidently establish long-term business plans while maintaining sufficient cash flow for other expenses. This gives you an edge over your competition and promotes long-term profitability.
3. It’s easier to upgrade equipment
Based on your business type, leasing can help you remain on top of the newest technology and equipment advancements. If your business requires you to keep your equipment for the short term, leasing might be a better option than purchasing and then trying to resell when you need to upgrade. It also allows you to determine your lease length. If you work with rapidly changing technology, you may consider short-term leases to ensure your business is always at the industry’s cutting edge.
4. Tax benefits
Equipment leasing offers your business potential tax advantages. In most cases, leasing provides your company with a total lease payment deduction against current earnings while preserving the working capital you wouldn’t otherwise access if you chose to buy the equipment. Always consult your tax advisor for advice on the benefits your business should expect.
5. Flexible lease terms
Equipment leasing presents multiple payment alternatives to pick from. Leases are easier to obtain and come with more flexible terms than equipment purchasing loans. After the down payment, you can make monthly payments on predetermined dates. This can be a great benefit if you have poor credit or have to negotiate for longer payment terms to reduce your costs. At the end of the lease period, you can renew your lease, return the equipment, secure an upgrade, or purchase the equipment.
6. Reduces repair and maintenance costs
Repair and maintenance costs are a significant concern for most businesses. With a leasing agreement, you can avoid these expenses because most leasing companies cover the equipment in case it breaks down and repair and maintain it accordingly.
Equipment leasing can be quite advantageous, especially for financially limited companies. Try leasing business equipment to enjoy these benefits.