Tag Archives: equipment lease

Living & Being Above Average

freedomIf we are honest with ourselves, most people don’t want an average life or existence, the great news is that we don’t have to settle for average in anything. We can change gears and our circumstances anytime, it’s up to us!

Of all the things that can have an effect on your future, I believe personal growth is the greatest. We can talk about sales growth, profit growth, asset growth, but all of this probably will not happen without personal growth. It’s really the open door to it all. In fact I’d like to have you memorize a most important phrase. Here it is, “The major key to your better future is YOU.”

Let me repeat that. “The major key to your better future is YOU.” Put it someplace where you can see it every day, in the bathroom, in the kitchen, at the office, anywhere where you can see it every day. The major key to your better future is YOU. Try to remember that every day you live and think about it. The major key is YOU.

Now, there are many things that will help your better future. If you belong to a strong, dynamic, progressive company, that would help. If the company has good products, good services that you are proud of, that would certainly help. If there were good sales aids, that would help, good training would certainly help. If there is strong leadership that will certainly help. All of these things will help, and of course, if it doesn’t storm, that will help. If your car doesn’t break down, that will help. If the kids don’t get sick, that will help. If the neighbors stay half way civil, that will help. If your relatives don’t bug you, that will help. If it isn’t too cold, if it isn’t too hot, all those things will help your better future. And if prices don’t go much higher and if taxes don’t get much heavier, that will help. And if the economy stays stable, those things will all help. We could go on and on with the list; but remember this, the list of things that I’ve just covered and many more – all put together – play a minor role in your better future.

The major key to your better future is you. Lock your mind onto that. This is a super important point to remember. The major key is you. A friend of mine has always answered when asked, “How do you develop an above average income?” He says, “Simple. Become an above average person. Work on you.” My friend says, “Develop an above average handshake.” He says, “A lot of people want to be successful, and they don’t even work on their handshake. As easy as that would be to start, they let it slide. They don’t understand.” My friend says, “Develop an above average smile. Develop an above average excitement. Develop an above average dedication. Develop an above average interest in other people.” He says, “To have more, become more.” Remember; work harder on yourself than you do on your job. For a long time in my life, I didn’t have this figured out.

Strangely enough, with two different people in the same company one may earn an extra $100 a month, and the other may earn a $1,000. What could possibly be the difference? If the products were the same, if the training was the same, if they both had the same literature, the same tools. If they both had the same teacher, the same compensation plan, if they both attended the same meetings, why would one person earn the $100 per month and the other person earn the $1000? Remember here is the difference…the difference is personal, inside, not outside, inside.

You see the real difference is inside you. In fact, the difference IS you. Someone once said, “The magic is not in the products. The magic is not in the literature. The magic is not in the film. There isn’t a magic meeting, but the magic that makes things better is inside you, and personal growth makes this magic work for you.”

The magic is in believing. The magic is in daring. The magic is in trying. The real magic is in persevering. The magic is in accepting. It’s in working. The magic is in thinking. There is magic in a handshake. There is magic in a smile. There is magic in excitement and determination. There is real magic in compassion and caring and sharing. There is unusual magic in strong feeling and you see, all that comes from inside, not outside. So, the difference is inside you. The real difference is you. You are the major key to your better future.

The Advantages of 10x thinking

If you could grow something that’s important to you by 10 times and end up with a simpler, easier-to-manage, more enjoyable business than you have now, would you do it?

It could be something obvious, like taking profits or sales tenfold, or perhaps something more creative, such as doubling your results with one-fifth the clientele or having 10 times more time off. What it looks like is totally up to you, as long as it amounts to a 10x greater result in some area of your entrepreneurial life.

Now what if I were to tell you that your chosen 10x goal was not an end unto itself? Rather it would just be the means by which you could develop and hone a new set of capabilities to enable you to go 10x in any area you choose in the future. Sound appealing?

This is essentially the challenge I’ve been offering to my most advanced clients—all highly successful, growth-focused entrepreneurs—over the past year and a half, and not surprisingly, almost all of them have taken me up on it.

Nonetheless, some entrepreneurs still think that 10x is too daunting or overwhelming to think about, and I understand how that might be the case, especially for those struggling with the complexity of the day-to-day in a tough economy. For those people, even growth by 2x may seem like a stretch.

My commitment to 10x thinking comes from my conviction that 10x is the only guaranteed way that entrepreneurs can ensure their continued freedom and success in a world where change happens at an exponential rate, led by technology. Incremental growth simply isn’t enough to stay ahead of the curve anymore. You and your team have to be able to think in terms of 10x improvements, 10x growth and 10x innovation in order to continually thrive. The future belongs to 10x companies. The good news is that growing one is probably much easier and more enjoyable than you think.

One reason is that 10x thinking immediately takes you out of the box of your current limitations and obstacles. The rewards of 10x thinking and 10x learning, driven by 10x goals, are immense and often surprising. Here are some of our observations so far from going through the process, as 150-plus top entrepreneurs from more than 50 industries have done.
1. As soon as you start thinking 10x, everything automatically speeds up.

Thinking 10x has a wonderful way of creating clarity that allows you to make greater progress more quickly. This happens because a 10x goal is a powerful filter for decision-making and action.

It immediately sorts out what parts of your business are or aren’t in alignment, and makes it clearer and easier to make decisions about what belongs in the future versus the past. You begin to ask yourself, “Does this relationship, this project, this activity have 10x potential?” or, “Is this process going to take us 10x?” or even, “Is this how I want to be spending my time to go 10x?”

Think for a moment: What would you have to stop doing to go 10x? There’s a 25 to 50 percent productivity increase just from stopping certain things that aren’t supporting your future growth. As you start to filter your activities, decisions and relationships through 10x, you can quickly begin to transform everything in your life that doesn’t support exponential growth, and create and attract everything that does.
2. Thinking 10x moves you into purely entrepreneurial decision-making, creativity, risk-taking and teamwork.

Bureaucracy is like kryptonite to entrepreneurs. Because there’s nothing bureaucratic about 10x thinking, it becomes a kind of protective shield: Any bureaucratic thinking, structures or processes that may have crept into your business can’t survive for long when you’re committed to 10x.

The reason for this is that 10x requires innovation, risk-taking and a level of entrepreneurial teamwork. Everyone on your team has to be creative on the spot and has to innovate and make continual improvements. This is the essence of what entrepreneurs do. A 10x company makes the ability to grow 10x part of its DNA. Its approach is always 10x, its systems and structures are built to create and support 10x growth, and its team members share its leaders’ 10x thinking. In such a company, if a new opportunity doesn’t have 10x potential, it’s likely to get rejected as a game not worth winning.
3. With 10x progress in mind, you start seeing an increasing number of 10x factors that can contribute to that progress.

Have you ever noticed that the eyes only see and the ears only hear what the mind is looking for? It’s just like when you buy a car, and at first you think you’re the only one with that model of car, and then you start noticing it everywhere. There are all kinds of 10x opportunities within and surrounding your business, but you have to look for them to see them, and then, all of a sudden, they’re obvious.

Great people with incredibly useful capabilities, strategic relationships, unique technologies and innovative shortcuts surround you. They’re what you need to go 10x, and your mind should see the project clearly to find them and put them to use.
4. As your team gets involved in 10x progress, leadership emerges, relationships strengthen and creativity increases.

Many entrepreneurs don’t love being in charge of developing, training, managing and motivating their teams. But when you focus your team on a 10x goal, all of these things become much easier. In fact, you may see much of it happening without any extra effort on your part.

Growth-oriented people, the ones you want on your team, are energized by big goals, and 10x gives them a big project on which they can work together. On the other hand, anyone who’s just there to collect a paycheck is likely to opt out. In a 10x company, every team member is always looking for things they can do 10x faster, easier, cheaper or bigger in their own areas of responsibility and knowledge. Adding up these small and perhaps big 10x improvements, the whole company eventually goes 10x. Think of it like a pot of water heating up on a stove. Each 10x innovation represents one of the small bubbles that eventually combine with others to bring the whole thing to a rolling boil.
5. Striving for 10x progress is faster, easier and cheaper—and is far more enjoyable and satisfying—than striving for 2x progress.

The statement above may seem counterintuitive, but going 2x is something that can happen without actually changing much of what you’re already doing. When we think about doubling our progress, we often just try to leverage our current capabilities, whereas going 10x engages a different level of creativity, energy and excitement.

Going 10x requires real change—leaps in value creation, in efficiency, in resourcefulness and in productivity. It can also put you at the forefront of change, driving it rather than struggling to keep up with constant, unpleasant surprises. Evolving technology is going to change you anyway, so why not say, “I’m going to adopt a level of thinking right up front that makes it a profitable, enjoyable trip.”

If your business needs some 10x thinking, give us a call. We’re here to help.

Don’t swing at nothin’ ugly. What do we really want as sales and business professionals?

A few years ago my son’s little league team was down by one in the bottom of the fourth inning. With two men on base and two outs our next hitter walked to the plate. On his way there Coach Sandro pulled him aside for a last bit of advice. His coaching was simple, he said, “Don’t swing at nothin’ ugly.” And as coach Sandro walked back to his position on the third base line it struck me how profound his advice was when applied to sales.

If you’ve ever played baseball or softball or your kids do, you have witnessed a player chasing a wild pitch – to high, to low, or way out side of the strike zone. The results are predictable and embarrassing. It is sometimes even funny to watch, but most times, the fans, coaches and players just echo a collective groan and wonder to themselves how in the world could he swing at that pitch.

It is no different is sales. Every day salespeople go out on the street and swing at ugly deals. Deals that are unprofitable, unqualified, not in the buying window, don’t have a budget, don’t have an identified decision maker, or because of contracts don’t have the ability to buy. From the outside looking in it is obvious that these low probability, ugly deals will never close and will be a drain on energy, emotions and time. Yet in spite of the obvious signs salespeople forge forward placing these deals in their pipelines and projections, spending endless hours working on ugly deals that will never close. The results are predictable. The vast majority of these salespeople strike out.

Meanwhile, frustrated sales managers look on in dismay pleading with their salespeople to let go of these ugly deals. It is an ongoing battle that is a core part of the sales manager’s job as a coach (just as it is the job of the baseball coach to keep players swinging in the strike zone). In Monday morning sales meetings and one on ones, in their own way, good sales managers coach their sales pros, “Don’t swing at nothin’ ugly.” And sadly, this advice is ignored more often than not.

 

So what can Sales Professionals do to keep from chasing ugly deals and how can sales managers help them.

First, it is critical that you clearly define the strike zone. Far too many companies and sales organizations have failed to develop the profile of an ideal prospect or customer. This is especially true in small entrepreneurial organizations. But here is a blinding flash of the obvious, if you don’t define the strike zone you will waste a lot of time chasing ugly deals. This process shouldn’t be difficult. Just analyze your best customers, the deals you are closing, and your market place. Then develop a profile of the prospect that is most likely to do business with you and, over the long-term, be a profitable, happy customer.

Next, make a commitment as a team to measure every prospect, deal, and customer against this profile. When they don’t fit, develop the discipline to walk away.

Now I not saying that every deal is going to fit your profile perfectly. This is not how the real world works. In some cases it makes sense to take some risk and swing outside of the strike zone. But there is a difference in taking a risk and chasing an ugly deal. That is where the sales manager plays a key role in discussing the opportunities with her salespeople and helping them make the right call. I also suggest using getting the entire team involved. You’ll find out quickly how powerful analyzing pipelines as a group can be.

And salespeople, you have to pay attention. You are often so close and so committed to the deal that you can’t see the obvious. Trust me on this one, if others are telling you that your deal is ugly – it is ugly.

The end goal is to keep your pipeline full of viable, qualified deals that have a high probability of closing. When you do your pay check will get bigger, you will have more fun, and ultimately you will have more time to spend on other things in your life.

This week when you hit the phones, get in your cars, or board airplanes to meet with prospects and customers remember Coach Sandro’s words, “Don’t swing at nothin’ ugly”

 

SHOULD YOU BUY OR LEASE YOUR CAR? People frequently ask, Is it more advantageous to lease or to buy a vehicle?

SHOULD YOU BUY OR LEASE YOUR CAR?

People frequently ask, “Is it more advantageous to lease or to buy a vehicle?”. Revenue Canada has considered each option and has established rules to ensure that one has little if any benefit over the other. The decision is therefore based on your situation, needs and cash flow circumstances. Whatever decision you make, make sure you thoroughly comparison shop and sleep on it before you make any final decision, sign documents and take the car away. You want to make a decision based on sound logic–not based on emotion or the dealer’s sales pitch. Compare the cost of each approach over the term you expect to own the vehicle.

There are many different types of leasing arrangements, and dealers offer a wide variety of choices and options on both new and used vehicles. All leases involve making periodic payments for the term of the lease, and there may or may not be an option to purchase the vehicle at the end of the lease.

On some leasing contracts, the vehicle is returned to the dealer at the end of the lease period and you have no further obligation except possibly paying for extra mileage or damage. On other leasing contracts, you will be asked to “guarantee” the dealer a residual value for the vehicle at the end of the lease period. Residual value is the amount the vehicle is expected to be worth at the end of the lease period, and is specified in the contract. Sometimes you may be able to buy the car for the residual value. If it is returned to the dealer and sold for less than the residual value, you must pay the dealer the difference.

Lease contract

This contract sets out the contractual nature of the deal. You cannot count on any representations that the sales rep makes to you that are not contained in the lease contract. So make sure that any statements made to you to induce you to lease the vehicle are written into the contract.

Important questions to ask

Before you sign any contract, make sure you have answers to these important questions and calculate what they will mean to you.

* What would be the total cost to buy the same vehicle and finance its purchase through a lender?

* What is the best retail price of the vehicle, and what price is the company using as the basis for the lease? The difference between the market value of the vehicle at the beginning and end of the lease is one of the main factors in calculating monthly payments.

* What is the interest rate being applied to the lease and how does it compare with current loan rates for purchasing a vehicle?

* Is there an option to buy the vehicle at the end of the lease?

* Can you buy the vehicle during the term of the lease, and if so, and are there penalties or additional charges?

* Are you required to guarantee the residual value of the car to the dealer?

* Can you terminate the lease before the date specified in the contract, and if so, is there a penalty or additional charge?

* How is normal wear and tear on the vehicle defined, and what is excessive wear and tear that makes you liable for an extra expense at the end of the lease?

* How is extra mileage defined and how much might you have to pay at the end of the lease?

* What is the total cost of the lease, and could you have bought a similar car for that amount?

* What are the associated fees you might have to pay for items such as insurance and administration? What are the late payment penalties?

* What is the total financial obligation of the lease, including the cost of all lease payments, plus all taxes, levies, fees, trade-in allowance, security deposit, advance payments and any down payments?

* Is the leasing contract easy to understand and is the information large enough to read without difficulty?

* What are the restrictions on the use of the vehicle–can you use it outside your city or province, or in another country?

* What is your responsibility for maintaining and servicing the vehicle?

* What are the warranties and guarantees, and is there any insurance provided for or required by you?

* What is the retail price of the vehicle, the price on which the lease payments are based, and the interest rate applied to the lease contract?

* What are the details of periodic payments, including the total number of payments, amount of each payment, payment dates, taxes on payments, and the total amount of all payments?

* Do you have “gap” protection? If you do, and you are in an accident and the vehicle is damaged beyond repair, this program will cover the difference after you pay the deductible, between what you owe on the remainder of your lease and the amount of your insurance settlement.

ADVANTAGES AND DISADVANTAGES OF BUYING

Advantages:

* you own the vehicle and therefore do not have any restrictions on use.

* you are building up potential equity in the vehicle (the value of the vehicle less the debt you have paid off).

* you can use the vehicle as security to borrow money.

* you can sell the vehicle and keep the money, after any loans are paid off

If you are using the car as a business vehicle, there are additional benefits:

# depreciation is deductible. For cars, it is 30 per cent a year on a declining balance. However, only a maximum of $25,000 (plus taxes) is accepted as the capital cost of the vehicle, no matter how much more you pay.
# interest on money that you borrow for the car purchase is deductible. However, there is a maximum of $300 a month, no matter how much more than that you pay.

Disadvantages:

If you are using the car as a business vehicle:

* you cannot deduct the full cost immediately

* only the first $25,000 plus taxes may be capitalized and depreciated for tax purposes. The car you want or need may cost more than that.

* only a maximum of $300 per month for interest is accepted by Revenue Canada.

* you pay your own repairs and maintenance expenses.

* time and effort is required to sell the vehicle.

For further information, you can pick up a free consumer booklet on vehicle leasing, Turning the Lights on Leasing, published by the Canadian Automobile Dealers Association. You can also purchase a Canadian “buy vs. lease” software program that customizes the pros and cons in specific situations. One such program is The Car Calculator, published by Orangesoft. You can obtain further information on it at 1-800-647-8693 or www.carcalculator.com. Also, check with your provincial consumer services department for brochures and any legislative lease protections for consumers that might be available.

Canada’s Economy- A Fortress or a Sandcastle?

In recent weeks, there has been considerable focus on the growing possibility of another U.S. recession – a risk that we peg at about 40%. This prospect has raised questions about Canada’s ability to withstand such a shock. Despite Canada’s relatively strong economic fundamentals and the continued outlook for growth, the economy is more vulnerable to a nasty external surprise than it was prior to the recent recession in 2008-09. While the business sector appears better positioned to weather a U.S. downturn, policymakers in Canada have less wiggle room on the fiscal and monetary fronts and households face larger debt burdens. In contrast to the experience in the 2008-09 downturn – when Canada’s economy suffered a considerably lesser blow than that Stateside – there is no assurance that a repeat would be in store in the event of a U.S. double dip. At a minimum, the Canadian economy would probably follow the U.S. into recession.

Less scope for policymaker response

One of the bigger differentiating factors is the reduced flexibility of monetary and fiscal authorities in Canada to respond. In 2007, Canadian short-term interest rates stood at 4.25%, government fiscal balances were in surplus and combined government federal-provincial debt was sitting at 54%. Indeed, the subsequent and massive injection of massive monetary and fiscal stimulus helped to prevent a difficult externally-driven, export-led recession from being considerably worse. Canada’s peak-to-trough decline in real GDP during the 2008-09 recession amounted to a sizeable 4%. But if the heavy losses in the export sector are stripped away, Canada’s household and government sectors suffered a much tamer drop of around 2.5%. Canadian job losses during the downturn were also heavily concentrated in the export sector. Today, a short-term interest rate at 1% leaves the Bank of Canada much less room to counter an economic shock without foraying into unconventional monetary policy options, such as quantitative easing. What’s more, with some $166 billion dollars more in outstanding federal and provincial debt (62 percentage points as a share of GDP), governments would be harder pressed to go on another major spending spree.

Household vulnerabilities have risen

The household sector’s flexibility to respond in the event of a severe bout of external headwinds is even more constrained. For one, the jobless rate remains more than a full percentage point above its pre-recession trough. Household debt as a share of after-tax income is considerably higher. It may be the case that the burden of debt service costs is actually lower today than four years ago due to the benefit

of lower borrowing rates. However, that could quickly change if income flows are abruptly cut off as a result of, say, a surge in layoffs. The higher home price-to-income ratio also suggests a larger degree of froth in the nation’s housing market despite the gyrations in home prices since 2007. By our measure, home prices are currently 10-15% over-valued. The bottom line is that household debt leaves households with less financial maneuvering room.

Business balance sheets stronger

Similar to the 2008-09 experience, a U.S. recession would swiftly hit Canada’s economy through the export channel. As such, many businesses would be in the line of fire. Roughly 70% of Canadian exports remain U.S.-bound while roughly one-fifth of business funding is generated in U.S. markets – shares which have not changed materially since 2007. At the same time, however, Canadian businesses would be in a better position to deal with the storm this time around. Businesses, on average, are holding less debt and are have more liquid assets. With commodity prices and the Canadian dollar in the same ball-park today as in 2007, profit margins are on the same magnitude. Another important factor to consider – especially when the level of risk to the Canadian business sector is considered – is the vulnerability of the U.S. economy compared to 2007. While the U.S. still faces a mountain of structural challenges – least of which is its ballooning government debt-load – it is highly unlikely that the economy is poised to suffer a contraction along the same line as that in 2008- 09. Unlike Canada, households and housing markets have

already undergone massive adjustments. Housing starts in particular can’t go much lower. Business balance sheets are also in decent condition notwithstanding the sluggish recovery to date.

Bottom Line

Canada’s economy headed into this summer’s turmoil in relatively good shape and our base case remains one of modest growth. Still we can’t ignore the simple fact that households and governments – two sectors that make up about four-fifths of Canadian economic activity – have a reduced capacity to respond to unanticipated negative events than was the case four years ago. The prevailing view is that if the U.S. economy were to fall into recession, Canada’s economy would likely follow suit. But by virtue of its fundamental strengths, many believe that the downturn would be less severe and the economy would recover more quickly than would be the case south of the border. Given Canada’s increased domestic vulnerability, such an outcome would not be guaranteed.

Trends in Financing Your Business In 2011..Trends change as time passes by and for business owners

Trends change as time passes by, and for business owners, being aware of these changes is an essential step to stay on top of the market. In this article, let’s talk about the trends in business financing for the year 2011

Angel Investment

Angel investors can be individuals or independent groups that are looking for promising businesses to invest in. Angel Investors became very popular in the late 90s and since then, has continued to be one of the most recognized means of business financing, particularly with
small business enterprisers.

Equipment lease financing
Equipment leasing is one of the most preferred ways of business financing not only for small businesses but even for big and established businesses. Through leasing, having a limited working capital does not have to be a big hindrance in bringing those bright business ideas to life. Because a lease is paid in instalment, a business owner is given the opportunity to obtain all devices or machines needed for the operations without a lot of upfront cost.

Supplier Credit
Many wholesale suppliers offer credit to their small business clients especially if they can present an impressive credit standing. Do inquire from prospective vendors who can supply you with your needed materials and stocks if you can be extended credit.

SBA Loans
If you are having difficulty getting approved for a bank loan or commercial loan, you can seek assistance from the Small Business Administration (SBA). By being backed-up by the SBA, it will be easier to get an approval from your chosen lender. However, take note that the SBA has its own standards in reviewing business loan applications.

Business Credit Cards
Today, an increasing number of business owners are recognizing the advantages of using credit cards for small business. Instead of using their personal credit cards, they are using business credit cards to separate their personal and business accounts, and to build business credit history. In the long run, having a solid business credit will be a huge factor in the future growth of a business and one of the easiest ways to build credit is to use a credit card for business.

Bank Loans
Even today, many small business entrepreneurs still prefer the traditional method of business financing. Why? This is because banks usually offer a larger sum of financing compared to commercial lenders. For homeowners who are willing to use their homes as collateral, a secured business loan gives them the chance to get the financial support they need to start their businesses with lower interest rates and longer repayment period.

Equipment Leasing vs. Equipment Loans, which is better?

Equipment Leasing vs. Equipment Loans, which is better?

Lease Loan
Application Process
A lease application can be as little as one page
for as much as $150,000 worth of equipment. Approval can occur within 24
hours.
Lenders
tend to require multiple financial documents before reviewing loan
applications for approval, such as tax returns and financial statements. This
process can take several days
Costs Covered

Leasing
covers the entire cost, including the equipment, tax, shipping and handling,
installation fees or any other expense associated with the equipment.

Loans
usually finance a portion of the equipment cost, neglecting excess costs in
acquiring the equipment such as equipment tax, shipping and handling and any
installation fees.
Types of Equipment
A lease
will generally approve any type of equipment needed, regardless of its
condition or whether it is new or used.
Lenders
may be skeptical about financing equipment they are unfamiliar with, or
equipment with low collateral or potential diminishing value.
Down Payments
There
is no down payment. The first payment usually entails the first and last
months’ payments
A down
payment is required, separate from the amount covered in the loan. The first
payment usually entails a down payment and the first month’s payment.
Interest Rates
The
interest rate is fixed. Each payment is inflexible, being determined at the
beginning of the lease. This simplifies budgeting, since lease payments are
not susceptible to change.
The
interest rate fluctuates. Payments may grow more or less expensive as the
market changes, making it difficult to determine how much capital to dedicate
to loan payments for a given fiscal year.
Collateral Requirements
Leasing
requires no collateral assets aside from the equipment being leased. A lessor
is only legally concerned with that aspect of the business being financed.
Banks
often claim other equipment or real estate of the company as collateral to
secure the loan. This can prove costly if the borrower defaults on a loan, as
more than just the financed equipment is at stake.
Equipment Ownership
Leased
assets do not appear on balance sheets, since the equipment is owned by the
leasing company. This can benefit a company’s financial ratio.
The
equipment is owned by the borrower and appears as an asset on the balance
sheets, which incorporates a degree of liability.
Additional Covenants
No
extra agreements are made between the lessor and lessee. If payments are made
on time, the lessor cannot demand immediate payment of outstanding debt or
reclaim the equipment.
Extra
covenants might be a part of a loan agreement. If any extra agreements are
broken, a bank might demand full payment of the remaining balance on the
loan, as well as impede use of the equipment being paid off. Future borrowing
may also be restricted.
Tax Benefits
A lease
usually allows for tax deduction of entire payments made toward the lease. If
the equipment keeps its relative value during the lease and is purchased at
the end, deductions can be made on depreciation thereafter.
A loan
usually allows for tax deduction on a portion of the loan as interest. Tax
deductions can also be made on the amount of depreciation attached to the
equipment. A borrower cannot deduct entire payments made on a loan.
End of Borrowing Term
At the
end of the lease term, the lessee may choose to transfer the burden of
equipment depreciation to the lessor or to keep the equipment. Purchase options
for as low as $1 are offered.
At the
end of a loan, the borrower owns the equipment and bears the risk of
equipment depreciation. If the equipment becomes obsolete during the duration
of the loan, it is still up to the borrower to make payments and dispose of
the useless equipment.

Weigh the pros and cons of an equipment lease before you sign…

Any business that is considering capital equipment leasing will need to weigh the pros and cons of obtaining a lease as opposed to making an outright purchase.

Any business that is considering capital equipment leasing will need to weigh the pros and cons of obtaining a lease as opposed to making an outright purchase. Many companies are discovering that there are a number of major benefits associated with leasing expensive machinery and other business needs. When seeking a bank loan to pay for equipment, most companies will need to come up with a hefty down payment. Lease agreements usually offer one hundred percent financing and require no down payment whatsoever. The budgeting process is made easier as well. Loan payments can fluctuate over the life of the loan depending on interest rates and other concerns. A lease payment will generally stay the same throughout the terms of the original agreement. Whenever a large loan is taken out, the debtor will see a dramatic decrease in their line of credit that is available. With leasing, this is not a problem. Lines of credit are generally not impacted in any way by a lease agreement. Leased machinery will work as well as machinery
that is owned. So why take on the extra debt when the same benefits to a particular business venture can be achieved through a lease? In some cases, a lease agreement may offer tax benefits that are not available when items are purchased. Many business owners feel that offering up large amounts of money to purchase machinery does not make sense and can be detrimental to a company’s bottom line. For this reason, capital equipment leasing can be a better choice.

Since income and available funds can fluctuate greatly throughout the year, pouring large amounts of money into paying for machinery can be a huge and costly mistake. Choosing capital equipment leasing rather than assuming huge debts can mean the difference between business success and failure. Most vendors and financing companies can work out a lease agreement that best meets the needs of a specific business. The length of a lease can vary and may last between one and five years. Larger equipment will generally have a longer life expectancy and may carry a longer lease as well. With a lease agreement expenses such as installation, freight costs, maintenance, and software can be rolled into the cost of the lease. If obsolescence is a concern, upgrades can usually be factored in to a lease agreement that will address such concerns. There are several different types of capital equipment leasing agreements that are generally available. These agreements could include a capital lease, an operating lease, a master lease, and a deferred payment lease. Capital and operating leases are basic, full pay out agreements. The main difference between these two agreements is that an operating lease allows the expense to be deducted on taxes. A master lease allows for additional items to be leased under the same terms at a future date. A deferred payment agreement allows new businesses to postpone full monthly payments for a brief time.

A variety of organizations can benefit from selecting capital equipment leasing.  In addition to businesses, governments, municipalities, and other associations might choose this option as
long as their credit scores qualify them. Credit worthiness is determined by a number of factors including the overall financial condition of the organization, the length of time that the venture has been around, scores from standard credit rating services, payment histories, and references from banks. While no down payment is generally required when signing a capital equipment
leasing agreement, some vendors may require that clients come up with one or two advance monthly payments at the beginning of a lease. Purchase options are usually outlined in the original terms of the lease and should be clearly explained to a client by a representative of the leasing company. Most leases will commence after machinery and equipment has been delivered and installed. Leased machinery is generally regarded as the property of the vendor and not the
lessee. For this reason, the lessee will not need to pay property taxes on the equipment. Lessees are, however, usually expected to cover the costs of insuring any leased items. These policies can be attained separately, or can be included by the vendor in the original contract. Most vendors will also allow clients to request a buyout quote at any time during the life of the lease if they so desire. Leasing companies will generally allow clients certain add on and upgrade options. Cancelling a lease agreement usually is not an option.

Before choosing a provider of capital equipment leasing, there are a few questions that a potential client may want to ask. The questions could include an explanation of all costs and what kinds of additional options are included in the agreement. Asking the right questions can help to ensure that the vendor that is chosen will be a good fit for a particular business.

Once a decision to go with capital equipment leasing has been made, a reputable vendor will need to be selected. Choosing how to finance the lease is another important decision. The CLFA, or Canadian Leasing and Finance Association can help a potential lessee make these crucial decisions. Including accountants and tax consultants in on these decisions can be a good idea. Whatever choices a business might make, the option of leasing needed machinery can be a cost
effective way to move forward.

Fitness Equipment Lease

Fitness Equipment Lease could be the response to the growing interest in fitness facilities. Health-consciousness is slowly beginning to stir one of the masses. By using it comes a comprehension from the need for exchanging an overweight, inactive body for a strong, lithe physique. However, there are lots of methods to accomplish this goal, a gym membership will be probably the most popular choices.The advantages these outfits gain by Fitness equipment lease, are plenty of. To outlive, a new gym needs to keep overheads to a minimum. Leasing, instead of purchasing, allows you to do this.

Fitness equipment lease enables you to get access to new technology or specialized equipment the moment it might be available, without committing your company to a substantial financial outlay. Constantly upgrading your facilities, is a vital element in staying in front of the competition.The extra financial advantage of never being tied to obsolete Fitness equipment lease, could be considerable. By not tying up a large chunk of the capital in equipment, you’ll be in a stronger position to handle daily expenses, while your venture finds its feet. If you want to expand, you are able to do this by Fitness equipment lease without stretching you to ultimately the limit, and compromising the soundness of the business. Borrowed finance goes together rich in rates of interest. When Fitness equipment lease the long run benefit in preserving about this aspect alone, becomes substantial.

As Fitness equipment lease is going to be shown being an operating expense, tax benefits will even flow from organizing your company in this manner. It’s even possible to structure payments to support the flow of economic inside your establishment, further strengthening income throughout the slow months.Regardless if you are searching for multi stack gyms, ellipticals, benches, treadmills, cycles, steppers, or even more specialized equipment, you will discover it on a leased basis.Your company will function with increased flexibility, and then cope with higher demand periods efficiently. Customers with special needs may also be looked after without hardship towards the business. A trusting relationship by having an experienced fitness equipment lease company offers reliability, a chance to arrange speedy financing, and a low payment schedule to meet your requirements – important factors to keep you competitive.
A Fair Market price Lease can also be readily available for utilization by schools, YMCA’s along with other organizations. This method offers tax benefits, lower monthly obligations, a massive array of lease obligation, and new equipment every 3 years. If one makes utilization of this fitness equipmentlease option, you will not need to be worried about the way you are likely to fund a security deposit, because this isn’t required.

A lot of companies and organizations are realizing that by establishing an in-house gym, they’re making a positive purchase of the near future productivity of the employees. The outcome is going to be observed in fewer sick days taken, a surge in employee-stamina, and a less stressed-out workforce. Most of all, the bottom-line from the company (and it is employees!) can give a clear indication from the benefits. By Fitness equipment lease, they’ve the chance to start such a program without a crippling capital outlay. Documentation involved when Fitness equipment lease the very first time, includes completing a credit form, copies of tax statements for principals, personal fiscal reports, equipment listing, and strategic business plan copies. Existing businesses will need to include company tax statements, and interim company fiscal reports. Response time after providing this, ought to be between 2 and Five days. Whether you’ve a small outfit, ordering a few thousand dollars price of equipment, or are well-muscled as well as in necessity of Fitness equipment leasewithin the seven-figure range, it is possible to locate a leasing option ideal for you.

The History of Equipment Leasing

Equipment leasing and how it works

All you needed to know about equipment leasing

Entrepreneurs may opt for equipmentt lease financingrather than investing cash in machinery that may become obsolete over time or increase overhead expenses. Technology, especially in electronics, changes so rapidly that corporations often prefer leasing computers, laser printers, copiers, and even telecommunications systems rather than buying. Business owners reason that money spent upgrading or purchasing new equipment to keep pace with technological advances every few years could be better

utilized by entering into either a “true” or a “finance” lease agreement. Another consideration for leasing over buying is simply to keep down overhead. Many companies, especially startups, cannot afford to furnish offices full of computer systems, desks and chairs, and file cabinets without breaking the bank. Long term rentals level the playing field between large corporate moguls with limitless funds versus small businesses with limited operating capital.

When businesses need machinery, computers, or copiers but lack the cash, they often opt for a true lease agreement which is similar to renting a piece of machinery or furnishings for an extended period of time with the intention of exchanging, or upgrading items at the end of the term or when newer models become available. Lessees have the advantage of having access to state-of-the-art tools and accessories without paying top dollar. True equipment lease financing may be more popular because monthly installments tend to be lower than a finance agreement, which works similar to buying on an installment plan. Companies which offer business accessories on a true lease can make more revenue by renting items again and again to various individuals and businesses. For example, a company leases a copier to a small firm for one year, at the end of which the lessee decides to upgrade to a pricier model with more features. The copier company has the option of leasing the older unit to another business owner, and another, until the original wholesale price of the copier has doubled or even tripled, especially when financing fees are added.

Certain types of long term equipment lease financingallows business owners to eventually own the machinery, computer, or copier at the end of the agreement or simply terminate the agreement and rent another piece of equipment. Finance leasing offers business owners an installment plan which works similar to buying an automobile or other big ticket item. All monthly payments go towards the purchase of the item; and lessees only need to make a buyout payment to transfer ownership, unless they decide to rent another piece of equipment under a separate agreement.
Unlike eternal life in Christ, copiers, telecommunications equipment, faxes, computers, and printers on long-term equipment lease financing are not expected to last a lifetime and usually require maintenance. Since rental agents retain ownership of all items, providing regular maintenance ensures that their investment is protected from user neglect or disrepair. Business owners who purchase machinery and supplies without leasing bear the burden of paying for maintenance and repair, usually covered under a separate agreement and subject to additional fees.

Flexible equipment lease financing can vary according to a business’ cash flow or longevity. Rental companies realize that a startup business may need time to realize a profit and make monthly payments, therefore some contracts start out with low payments which gradually increase over a period of time. Called a step lease, this kind of financing is more flexible than being locked into a rigid installment contract. As the business profits, lessees are more able to handle increased overhead expenses, including rentals. Some flexible plans might also offer lessees an opportunity to rent for one to three months without a payment in order to ease the financial burden of starting a new enterprise. Not uncommon are contracts which allow renters to keep merchandise for up to one year without making a payment; however when installment plans kick in, they can include some hidden fees and interest rates.

Long-term equipment lease financing also has its advantages at tax time. The value of purchased machinery and computers must be depreciated each year; however rental payments are 100% tax-deductible if utilized solely for business purposes. Owners can realize a tax break by deducting monthly payments, maintenance fees, and supplies as part of overhead expense. However, state and federal revenue departments may view rental payments as installments towards a purchase and require that equipment be depreciated, rather than deducted at 100% of its value. Entrepreneurs considering long term leasing may want to consult with tax professionals or certified public accountants to determine which type of agreement offers the best deduction.

Dealers or manufacturers of office furnishings or machinery usually have an in-house department or an independent agency which specializes in equipment lease financing. The independent agency or onsite department buys the item and loans it back to the customer for a specific monthly installment deducted from the purchase price at the end of the term, or a monthly rental without expectation of a buyout. Individuals and corporations who opt for lease financing will need to have good to excellent credit and submit banking information to rental companies. Consumers can find leasing firms online or in the local business directory; however most local dealers and suppliers will refer customers to a preferred agent. Before signing on the dotted line of short- or long-term contracts for equipment lease financing, entrepreneurs should read the fine print, especially when it comes to terminating the agreement before the end of the contract, maintenance and repairs, consumables, and buyouts.