20 Reasons To Lease Equipment

There are numerous benefits of leasing, a method of financing equipment which has been popular for many years. It provides some very unique benefits over conventional bank financing or an outright purchase, and here are 20 reasons to lease equipment.

1. Pay As You Use

Leasing highlights the utility value of the equipment. In other words, leasing provides the opportunity to pay for equipment as it is generating revenue for the company. No different than paying employees bi-weekly or monthly as opposed to pre-paying them for the next 2 or 3 years of work. Both are assets of the company, and it makes no sense to pre-pay for either.

2. Payments Are Fixed

In most cases, lease payments are fixed for the duration of the term. This has a major advantage over conventional bank loans or purchases from a credit where the interest rate are commonly based on a floating rate. Knowing in advance what the payments will be, facilitates ease of budgeting and reduces interest rate risk.

3. Longer Terms / Lower Payments

Many banking institutions will limit the term of a loan to 12or 24 months, at which time the rate and terms of the loan are re-negotiated. Based on the useful life of the equipment being leased, it is not uncommon the see fixed lease terms as long as 48 or 60 months. This in effect lowers the monthly payment at a fixed rate.

4. Obsolescence Protection

In this era of major technological advances, certain types of equipment purchased today, can be obsolete within one or two years. Most leases offer a provision to economically upgrade equipment within the last year of the lease contract thus giving the company a built in obsolescence protection. In addition, although the leasing company holds title to the equipment, the will generally allow the vendor to provide a trade in on the existing equipment.

5. No Down Payment

Conventional banking institutions will generally require a down payment of 10%-25% in order to undertake financing on most equipment. In a lease transaction, the entire amount is financed with only the first or first and last payment being required at the time of lease inception. In some cases where the financial strength of the company is not sufficient to support the amount being leased, a small down payment may be required.

6. 100% Financing

Traditional financing methods will frequently not allow soft costs such as installation, freight, maintenance, and software to be included in the loan. These must be paid directly out of working capital. A lease, on the other hand, will allow soft costs to be included, thus conserving working capital and allowing for a single monthly payment for the entire acquisition.

7. Fast And Easy

Depending on the dollar amount of the acquisition, a traditional loan may take many days and require approvals from higher levels within the financial institution. This can mean delays in getting the order placed for the much needed equipment. The credit process for a lease acquisition is generally much faster and can be as quickly as a few hours up to a couple of days. Again depending on the size of the acquisition.

8. Creativity And Flexibility

Banks are typically known for their creativity and flexibility. The are bound by the Bank Act which limits some of the things they can do to assist their client base. Leasing, on the other hand has evolved into a method of financing which focuses on the specific requirements of the client. Payments can be structured to accommodate irregular revenue streams during the year or set up to match payback on a piece of equipment that has a quantifiable monthly savings. Leasing is the ultimate form of creative financing.

9. Purchase And Renewal Options

At one time leases were structured in such a way that the only purchase option available was the Fair Market Value of the equipment determined at the end of the lease term. Over the years, the market has made it clear that they want a better define purchase price set out at the inception of the lease. As a result, most leasing companies will set a mutually agreed upon end of term purchase price at the outset of the lease. This can range from $1.00 to 25% and is often reflected in the monthly payment. In addition, the purchase option can again refinanced under a new lease contract generally over a 12 to 24 month term.

10. Conservation of Working Capital

In a recent industry survey, the number one reason for leasing equipment was conversation of working capital. By using lease financing, working capital is freed up to be used in the day to day operation of the business for things such as purchasing inventory, advertising, trade shows, and hiring employees. Essentially, leasing allows a company to reduce the amount invested in a depreciating asset, and use the money where it will generate a higher return.

11. Simplified Forecasting

Lease payments show up as an expense on the company income statement. Because payments are fixed and pre-determined at the outset of the lease, companies are able to intelligently forecast and budget into the future.

12. Capital Budgets To Operating Budgets

Within large organizations, capital acquisitions generally require a higher level of approval than operating expenses, and as a result take more time. A lease acquisition, being a monthly expense, will generally fall within an operating budget affording managers within various departments or business units to approve acquisitions of much needed equipment.

13. Tax Benefits

Because lease payments are treated as an expense on the income statement, the payments can generally be written off. Because each company has unique financial circumstances, and accounting firms which differ on the accounting treatment of a lease, it is suggested that the accounting firm be consulted prior to making a decision to lease on the sole basis of tax advantages.

14. Low Interest / No Interest Programs

From time to time vendors of equipment will offer time sensitive low or no interest marketing programs to help them sell slow moving inventory. It is prudent to watch for these types of programs or ask the vendor if they have any leasing incentives available.

15. Master Lease Agreements

A Master Lease Agreement is simply a document which contains all of the terms and conditions of the lease and is signed once and covers all future lease acquisitions. Generally a lease line of credit is pre-approved for a dollar amount which will accommodate anticipated acquisitions over a period of time. As equipment is acquired, a simple one page document is signed. This saves time and is effective in an expansion or a major project.

16. Preserve Bank Credit Lines

No company wants to be operating at the top of their credit line and are often reluctant to approach the bank for a credit line increase. It is prudent business practice to have funds available for unexpected events-a slow month or quarter, unpaid receivables, or an unexpected damage claim. The use of leasing creates a new credit facility without any effect on the banking relationship.

17. Hedge Against Inflation

Leasing allows for payment of in dollars, and in turn pay those costs incrementally in inflated future dollars, as the equipment is used.

18. Competitive Edge

Staying ahead of the competition often requires the latest and best technology. Leasing equipment lets you do the job more efficiently, more effectively, and more economically. In addition it provides the advantage of continually upgrading to latest available technology at a reasonable cost.

19. Sale And Leaseback

A Sale & Leaseback is a specialized lease transaction where the leasing company will purchase unencumbered equipment, at a fair market price from a company, and lease it back to them. It is a tremendous way of freeing up capital which is tied up in depreciated assets.

20. Enhanced Corporate Image

The vehicles in the fleet and the equipment in the production, all have an effect on the corporate image. Leasing allows assets to look new, fresh, and and create the image of a successful company.

In summary, leasing came about as a means to acquire equipment and it is no wonder that many equipment manufacturers have set up their ow leasing arms to help their customers acquire products in the most effective way. Leasing just make good business sense.



Source by Kelvin Johnstone

Top Reasons to Love PC Games

Most of the kids love to play PC games. Not only the kids even some of the adults love them too. It should be noted that the games that are liked by these entertainment loving players are not always an easy option to play. Most of them are quite difficult. But as I mentioned earlier that we are all lovers of the games so do we master its tricks soon with focused playing. Now, coming to the devices that are used to play games we can say that there are mainly two types of gaming. One is the gaming consoles and the other one is the PC games.

While consoles are new and can be easily carried everywhere but the game lovers claim that the PC games offer better gaming experiences. Reasons that attract gamers to play games on the PC are described underneath.

Availability of Different Types of Games

In the PC, one can get to play a number of games. This is because PC has several features which provide the necessary environment for installing and playing the games. Most of the games are free to download, but, if you are using the consoles then you have to pay for each and every games you install in them or want to upgrade. So, you can install any games from the adventures games to the games that kids like to play.

Better Gaming Experience

With PC, you get the opportunity to play with the gaming keyboards, joysticks, etc. The consoles never offer such choices. It has limited keys and overuse of them can cause them to damage. They also do not offer immersive sound quality like the PC does. And when someone else is around then they can use headsets to enjoy the sounds. You can also challenge you peers over the net and call them to compete with you over PC. The consoles have limited number of games that offers these facilities.

Longer Life of the Devices

Consoles last for a maximum of 3 years. It might be less but not more while a personal computer lasts for several years. You actually do not have to get them upgraded frequently because newer versions if at all comes need not be installed necessarily.

So, you can see that everything about the PC games is good and easy. Undoubtedly, for the same reasons, PC games have become the easy choice of the numerous players around the world.



Source by Aman Tumukur Khanna

How to Purchase a Used Automobile: Tips From the Auto Insurance Guys

These days, purchasing a new car requires a lot of money. For those looking for another option due to the financial output, shopping for a used car may be a good bet. Of course, a previously owned car, no matter how sleek and shiny may have hidden disadvantages.

Below find tips from some finely-tuned insurance professionals on how to go about the task of shopping for a used car.

8 Ways to Get a Good Deal on a Previously-Owned Car

• Decide How Much You Can Spend on the Purchase
Prior to shopping around for a good used car, do a personal financial tally. Then focus only on buys you can afford – whether via financing or full payment method.

• Choose the Right Kind of Vehicle
Unmarried people without kids do not need a big car. On the other side of the coin, married individuals with children in tow could use a larger car. Recreational drivers, long-distance drivers and city or highway drivers have different needs as well. Assess your individual requirements, then shop for the car that matches them.

• Check Out Prices and Repair Frequency
Look online to determine what you should be paying for car makes and models according to year and usage. This search will also let you know what type of vehicles requires less maintenance work and what type has less mechanical headaches.

• Learn about the Car's Past
Research a particular car's history by putting in the Vehicle Information Numbers. This will get you to a full report about past collisions, owners and even recorded maintenance and repair jobs.

• Test the Car out by Taking it for a Spin
Drive your prospective car purchase over a calculated route that includes hills, bumps, curves and highway maneuvering. This way, you'll get an idea how the overall driving ability is.

• Get a Professional Mechanic's Opinion
Enlist your favorite mechanic in the decision by hiring him or her to inspect the car for surface problems that a layman like you may not be able to detect.

• Use Your Price-Negotiating Skills
Utilize the knowledge you have gained from all your research on the car to negotiate a price that fairly reflects its true value.

And Last But Surely Not Least

• Do not Forget About Auto Insurance
Before completing the buying process, speak to an experienced independent insurance agent about insurance for the vehicle. After binding the policy, sign the contract, pay, and you are good to go. No worries about the possibility of no coverage on the road to home!

Now that you have a new (used) automobile take care of it with good maintenance practices and remember to keep driving safety a priority.

Happy driving!



Source by M Wyzanski

Understanding Auto Repair Abbreviations

Like any specialized field, auto repair has its own unique set of abbreviations. Used by professionals, the abbreviations can seem to create a completely different language. This can be frustrating for car owners who may not understand what's being said and who find themselves too embarrassed to ask questions on their meaning.

While you should always ask any question that pops in your head especially when dealing with something as important as auto repair, you can ease the embarrassment by studying up on some of the more common auto repair abbreviations.

Now many car owners will encounter only specific abbreviations, usually ones dealing with parts. These abbreviations will probably be used when considering the replacement of damaged items of your car and may even show up on your bill.

OEM- Original Equipment Manufacturer. This simply means that the part is certified new by the manufacturer of the car. This is important for those owners wanting only new parts and that need an assurance of that fact.

QRP- Quality Replacement Part. When mechanisms use "QRP" it is used as a euphemism. What this really means is that the part is an aftermarket part.

A / M- Aftermarket. An A / M is a part not made by the manufacturer of your vehicle.

Now other abbreviations will be used when dealing with the actual maintenance of the vehicle. These abbreviations are second nature to many mechanisms who may use them absent mindedly even to customers.

A / F Ratio-Air / Fuel Ratio or Air to Fuel Ratio. A proper A / F Ratio is needed to properly start the car.

CAT-Catalytic Converter. Back in the 1970s the United States started strengthening EPA standards relating internal combustion engines. The CAT is used to turn toxic by products into something a little less toxic.

DFI- Digital Fuel Injector. Fuel Injectors replaced carburetors back in the 1980s. The DFI relations on high pressure to mix the fuel and air where carburetors used low pressure.

DTC- Diagnostic Trouble Code. As the name suggests, the DTC helps to identify any problems. The mechanic reads the DTC with the help of a scanner tool. The DTC consists of 5 digits.

FIPL- Fuel Injector Pump Lever. This piece of equipment insures the continued operation and performance of the fuel injector pump. The fuel injector pump is responsible for getting the fuel from the tank to the injectors. This is critical for the vehicles continued performance.

GPS- Global Positioning System. These systems are becoming more and more popular and are even featured in many of the newer model cars. There should be something wrong with the GPS then you need to make sure that the mechanic understands how to work on it.

hp- Horsepower. Horsepower is a measurement of power and is usually used to refer to trucks and some SUVs.

Now, there are certainly numerous other abbreviations beyond what is listed here which you will no doubt hear while having your car service It is always a good idea to learn at least a handful of abbreviations before heading to a mechanic. A little knowledge goes a long way, after all, and by displaying some know how you will be able to understand the lingo and jargon of the auto repair shop.



Source by Emma Gold