Business Financing

Written by Linda Alexander
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There are many ways to raise business financing, whether your company is a startup or has been in business for years. Before committing to any financing, be sure to explore all of your options, from loans, to going public, to factoring and venture capital. One often overlooked way to free up financing is to lease equipment rather than buying it outright.

For many businesses, having enough capital to operate on a daily basis is a large issue. It can be difficult to get enough cash together to meet payroll, buy supplies, or pay bills. If your business needs equipment, leasing equipment can be a better alternative to borrowing when you need business financing.

Business Financing through Leasing

When all of your money is in your equipment, your business can be asset rich and cash poor. This limits you in flexibility and can hinder you when you need to respond to changing market conditions. Leasing equipment can free up working capital as well as help you save money on your taxes. Most leases will also give you 100 percent financing, including the equipment, installation, and maintenance. This will save even more money down the road.

If assets depreciate quickly over time, such as computers, leasing might be your best option for business financing. You can upgrade your equipment every few years, instead of buying it outright. Also, it might be easier to lease equipment instead of getting a loan for it--banks will want to see a solid business plan, while an equipment company might only want to see the last six months of your credit history.


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