10 Reasons to Lease vs. Buying Equipment and Machinery

Determining whether to lease or buy equipment for your business can be difficult. While both are pros and cons, leasing can be more beneficial than buying. Especially when it comes to maintenance costs and tax write-offs, there are several hidden benefits to leasing equipment and machinery that shouldn’t be overlooked.

10 Reasons to Lease vs. Buying Equipment and Machinery

1. Less Expensive in the Short-Term
   Leasing equipment is a much more affordable option in the short term. While the costs can add up over a long period, leasing in the short term allows your business to save substantial money for other projects. This is immensely beneficial if your business is still growing or you need the capital for a more significant purchase.
2. Equipment Leases are Tax Deductible
   Luckily for business owners, equipment rentals are generally 100% tax deductible as legitimate business expenses.
3. Easier to Upgrade Equipment
   Unexpected outcomes during your operations may completely change the equipment you need. If you realize you don’t have the right equipment or machinery for the job, upgrading is easier than ever if you lease. This is because you aren’t stuck with an asset on which you must make continual payments—if you need to upgrade, it’s simpler than ever.
4. Lease Terms Are More Flexible
   Along with being easier to upgrade, equipment leases are much more flexible than equipment purchases. If you need to upgrade or switch machinery, lessors like Equipment Leases have flexible terms that work for your business. Buying simply does not provide this flexibility, as you are locked into a long-term purchase, often with a loan.
5. 100% financing is Usually Available
   A major advantage of leasing is that you can roll all the sift costs into the lease, including delivery, training, insurance, software upgrades, etc.  This financing flexibility is rarely available in bank financing or traditional lending institutions.
6. Eliminates the Need to Trash Outdated Machinery
   Equipment depreciates and becomes obsolete quickly. When you buy, you risk being stuck with machinery that doesn’t keep up with industry standards. Instead of throwing out or trying to salvage old machinery every few years, leasing ensures you consistently have the industry’s best equipment.
7. More accessible to Get Equipment with Iffy Credit
   You may not have the best credit, especially if you are a new business. That’s perfectly fine! Leasing eliminates the need for years of credit history since you aren’t taking out a loan to finance an equipment purchase.
8. Leasing Is Beneficial for Businesses with Smaller Cash Flows
   Newer businesses don’t always have the cash to purchase expensive, state-of-the-art equipment. Another significant advantage of leasing is that smaller cash flows don’t have to stop you from growing your business since it’s also cheaper in the short term.
9. You’ll Be Using the Equipment for Less Than 5 Years
   Since equipment and machinery become obsolete quickly, it makes more sense to lease if you plan to use the equipment for less than 5 years. This ensures your business isn’t stuck with outdated equipment and a hefty bank loan to finance a large purchase.
10. Leasing Allows Your Business to Stay Competitive
    Lastly, leasing ensures you keep your business ahead of the competition. From helping businesses with smaller cash flows grow to using the newest machinery on the market, leasing is the simple choice to stay ahead of the competition. If you don’t have the machinery to do the job, you can bet that your customers will choose a company that does.

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