Easily Expand your Business with Equipment Leasing

Augments Working Capital

Leasing confers many advantages to the cash flow of your growing business. If you decide to purchase your capital equipment with cash only, your working capital will plummet dramatically. This will bring about the entire spectrum of problems associated with low working capital. This can include problems like being unable to pay your creditors on time, being unable to run daily operations and missing out on business opportunities. These are the massive hidden costs that are not taken into account by naïve souls who claim that leases are more “expensive” then cash payments.

Working capital has been called the lifeblood of businesses. You can maintain strong working capital because lease payments are comparatively small so they won’t hamper quick assets. And the equipment leased will generate revenues, pay for the lease and augment your working capital all at the same time. With equipment leasing, it’s a win-win situation for your business from all aspects.

Tax Benefits

Some types of leases are tax deductible. Smart business owners take advantage of this fact when expanding their businesses. The Section 179 deduction is a significant tax benefit that is now permanent since it is has been permanently ratified under the PATH Act – “Protecting America from Tax Hike Act.” Since Section 179 is permanent, you can incorporate it into your planning, budgets and forecasts to obtain more reliable cash flows. The good news is that some equipment leases are 100% tax deductible. Hence, get in touch with your tax consultant to find out which lease will offer you the most deductions. The opinions presented here should not be construed as tax advice. Always clarify tax matters with the advice of a qualified tax professional.

Hedging Obsolescence

For a rapidly growing business, leasing can mitigate the risk of obsolescence since you have very flexible terms and conditions. If you purchase equipment with cash, then you are stuck with the said equipment. When it becomes obsolete, no one is going to return your cash in exchange for obsolete equipment. But this does not happen with equipment leases. You can upgrade your equipment according to the lease terms and conditions. So leasing has become particularly popular with software, electronic equipment, precision manufacturing equipment, etc.

Mitigating Inflation

Leasing also allows businesses to expand by hedging against inflation. Suppose you have to pay $100 every month. Due to rising inflation, each successive $100 payment will be worth less than the previous amounts. Therefore, you are getting great benefits by paying over an extended period of rising prices.

What about Banks?

Banks are not the most dependable sources of leases for growing businesses. They can turn down your lease application with perfect equanimity by citing some technicality, for example, your credit rating.

The bank will avidly scrutinize your financial statements to gauge your financial abilities. This entails a tedious inquiry procedure that nearly degenerates to the brink of an interrogation.

It is well known in business that time is money. Each day wasted on prolonged bank inquiries represents lost earnings. Hence, this is an important hidden cost of bank loans in addition to the exorbitant interest rates. Alternative lenders can forward you funds in as little as 24 hours so you are spared the time, lost earnings and the accompanying agony.

Your expanding business needs a much more dependable source for leasing and this is where alternative sources of funding like KLB Business Funding come into the equation.

KLB Business Funding offers great advantages like applications up to $250,000 without the need to procure financial statements.

So, get in contact with us today.

• 3702 Pratt Avenue Bronx NY 10466
• (347) 755-2257

info@klbbusinessfunding.com