Home » Guides » Operations » Industrial Equipment and Supplies » Leasing Equipment

Guide to Leasing Equipment

Don't have the cash for important gear? Even if you do, you might be better off leasing

By Chris Caggiano


Equipment leasing is a great way to get the business gear that your company needs to grow. What can you lease? Just about any hard asset with a four-digit-or-more price tag, from computers to furniture to heavy machinery. Typical leases are between 24 and 48 months.

Leasing provides many benefits, but the most important is better cash flow for your company, since leasing typically carries little in the way of up-front costs. Leasing is easier and faster than bank financing, and it allows you to have the latest equipment. The downside: it's more expensive than bank financing in the long run, you have to pay even if you stop using the equipment, and you'll probably need to guarantee the lease payments personally.

The main types of leases are:

  1. A capital (or finance) lease, which is like a loan. It spans the entire expected life of the equipment. A capital lease is great if you plan to keep the equipment at the end of the lease. You can also treat the gear as a depreciable asset.
  2. An operating (or true) lease, which is more like a rental contract. It's shorter than the life of the equipment and generally will tie up less of your cash. Payments are often tax deductible.
  3. A skip lease allows you to skip payments during slow months, which is ideal for seasonal businesses.

Action Steps
The best contacts and resources to help you get it done


Contact manufacturers directly

Many large manufacturers provide leasing options or referrals to interested companies. You can usually find this information on their Web sites by searching for "leasing."
I recommend: See the Web sites for Toshiba and Hewlett Packard for examples of manufacturers with leasing options.

Find leasing companies via online directories

Even if manufacturers have their own leasing options, it also makes sense to get quotes from independent sources.
I recommend: You can find a list of equipment-leasing companies at PrintCities and request rate quotes through the Equipment Leasing Association (ELA).

Consider the big names as well

A number of the business-finance behemoths have leasing arms. If you already do business with a large financial institution, it's worth asking if they're involved in equipment leasing as well.
I recommend: For examples of big companies that also do equipment leasing, check out GE Capital Corp and JPMorgan Chase Bank.

Tips & Tactics
Helpful advice for making the most of this Guide

  • Shop around for vendors and types of leases to see which best meets your needs.
  • Discuss the tax implications of the various lease types with your accountant.
  • Ask your lease company for four to five references, preferably companies similar to yours in size and sector.
  • Check any prospective vendors out with the Better Business Bureau to see if there have been any complaints.
Lease Financing for Energy
Invests in and finances the global energy sector, providing equity, debt, leases, project finance, partnerships and commercial financing.
www.geenergyfinancialservices.com
Equipment Leasing & Financing Quotes: AllOptions
Submit a simple form to compare rates, payments and fees from multiple vendors at no cost or obligation!
Request Quotes | Compare Options | Low Rates
www.AllOptions.com
Specialized Leasing - Free Price Quotes
Compare Prices and Save. Visit Now for Free Price Quotes!
Free Price Quotes | Start Request Now
Equipment_Leasing.BuyerZone.com
Office Space Listings
View office space listings, including executive suites and office rentals. View all online, 100% Free Search.
Search | Company Info | FAQ | Contact Us
www.InstantOffices.com

Recommended Solution Providers

eLease International
Business-equipment leasing and equipment insurance is available for businesses of all sizes.

GCR Capital Equipment Leasing
Get the correct asset-based financing solution for your equipment needs.

BuyerZone: Equipment Lease
Learn about equipment financing and get custom quotes from several vendors.

Regions Commercial Leasing
Asset-based and commercial leasing programs are available.

Tiger Leasing
This independent company provides customized commercial leasing programs for growing businesses.

Business Finance: Small Business Equipment Leasing
Search over 4,000 sources of business financing.

Key Equipment Finance
This company will develop a financing solution customized for a small business.

Best Sites to Learn More

Equipment Leasing Association: Choose Leasing
Learn to make informed choices about leasing or buying, flexibility and financing options.

BNET: Operations: Purchasing and Procurement: Leasing
Read white papers and articles about equipment leasing and lease financing.

AllBusiness: Equipment Leasing & Rental Articles
Offers links to articles on equipment leasing from a range of business periodicals.

Best Blogs and Forums

Equipment Leasing News: Understanding Equipment Leasing Blog
eLease International staff post news and information about equipment leasing.

Leasing Notes Blog
CPA and industry consultant Shawn Halladay discusses all aspects of equipment leasing.



FEATURED LISTINGS
Business.com Answers

Ask a Business Question

115 characters maximum

What WorksTM for Industrial Equipment and Supplies

Daniel Kehrer

Keeping Up with Business Technology

How to stay plugged into the latest tech news, info, advice & reviews
The technology needed to build a profitable small to medium-sized business (SMB) is always changing. Every day there's some new web app, networking device, "must-have" security fix, laptop, PDA, printer, software, e-commerce breakthrough, or a hundred other things you or your IT person needs to know about. The pace of change is so rapid that the fear of failing to keep up with tech has become a top concern for SMBs ... Read more

Free B2B search marketing whitepaper, B2B Search Marketing Strategy Guide: Advice From the Pros.
Download

To advertise on Business.com, click here