When you’re looking for a new car or van for your business, there’s a lot of choices. Not just in terms of which vehicle to go for, but how to fund it.
Most people are pretty familiar with buying a new car outright, but leasing is still unfamiliar territory to some, despite its growth in the UK. This page explains the benefits of both options and will help you decide which is best for your business.
What is leasing?
Many businesses choose to lease equipment, vehicles, and tools for their business, as it can be a more cost-effective alternative to buying outright, especially when funds are tight.
With leasing, you make fixed monthly payments. At the end of the lease period you won’t own the equipment, vehicle or tools, but may have the opportunity to extend the lease agreement, or start a new one.
Leasing is popular among businesses of all sizes who rely on vehicles, whether that’s a single van or an entire fleet. For example, a startup catering company needing several vans to deliver food to their clients may not have the capital to purchase the vehicles outright, but could afford smaller monthly payments.
Video: The pros and cons of leasing and buying equipment
by Informi
The following video highlights the pros and cons of leasing business equipment against buying it outright. We run through the different approaches, explaining why a business may wish to lease or buy equipment.
What do I want for my business?
The money
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The risk factors
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The hassle
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So should I lease or buy?
Leasing isn’t right for everyone, and neither is buying. There are lots of things to consider, including the vehicle you’re interested and your personal or business circumstances. You should compare both funding methods, and see which works out better – you might be surprised.
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