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Lease vs. Purchase of equipment in industry?
Posted on 8/1/16 at 8:15 am
Posted on 8/1/16 at 8:15 am
Spin-off from my "OT-financial advisor as 2d career" thread. I’m being recruited by a finance company that specializes in leasing new or replacement high-end or expensive equipment to companies that are needing to get into new equipment for whatever reason. It’s something I had not considered and their approach is intriguing me. So I wanted to reach out to someone in manufacturing to ask how prevalent is leasing equipment in your business? I’m trying to figure out what the potential is if I jump on board with these guys. Have any business owners on the board leased instead of purchased? From what I understand the benefit is situational to each line of effort but essentially it gets a business into something they might not be able to afford buying outright and enable a faster process to get on-line and operating. Do you see any trends in lease vs. purchase for things like CNC machinery or robotic welders or even tech refresh computer replacement efforts?
Thoughts?
Thoughts?
Posted on 8/1/16 at 8:49 am to Brick67
Companies certainly do try to buy equipment over time so that they can have a more competitive bid, but leasing is an absolutely booming business because for a lot of contractors, carrying too much equipment can hurt your financial statement and thus bonding capacity. Plus, the cost of the lease is added to the bid and passed back to the owner of the job. It's definitely a balancing act to a degree.
Posted on 8/1/16 at 9:12 am to Brick67
Maintenance and up-keep are an essential part of the equation. Outright purchase requires your own mechanic labor work and liability of down time should your equipment break down. Lease usually includes some sort of maintenance program and ability to swap out equipment should break down occur.
Posted on 8/1/16 at 6:49 pm to AutoYes_Clown
This is the reason thinking if I can just get the USAF to lease their E-Tool ruggedized laptops instead of purchasing them I could make a mint.
Posted on 8/2/16 at 10:46 am to Brick67
Do you have any DOD experience or an in somewhere high up? If you don't, good luck. DOD contracting is a completely different ball game than private business.
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