In today’s sputtering economy, smart business managers are discovering some of the best financing solutions are right under their noses: Their company’s equipment. The equipment lease is a business financing tool that can help many companies weather the current economic storm with a healthy injection of cash.
September 15, 2010 – Fredericksburg, VA – Most businesses require equipment in order to operate and to make money. Many have millions of dollars tied up in all types of machinery and equipment — business capital that can be unlocked and made available to the company with the equipment lease.
The equipment lease was in its infancy just 25 years ago. Today, businesses lease hundreds of billions of dollars worth of equipment each and every year.
According to Mike Lieber, creator of the business financing web site, www.smart-business-financing.com, as commercial lenders have clamped down on traditional forms of business credit, companies have increasingly turned to the equipment lease as a source of working capital financing.
“Business owners and finance professionals are having to get a little more creative in today’s economy, and they’re discovering they have a lot of idle money sitting around in things they already own,” he says.
Lieber’s Virginia-based company, AEGIS Financial Solutions, Inc., specializes in asset-based finance techniques that can help companies free up capital they may not even know they have. Whether it is money tied up in accounts receivable, sales contracts, commercial real estate, or equipment, there are financial products that can put much needed cash in a business owner’s hands without the complexity or hassles associated with bank loans.
In the case of equipment and machinery, there are firms that specialize in creating flexible financing packages called “sale and lease-back” arrangements.
“In a sale and lease-back, a company sells equipment to an equipment lease company for cash and agrees to lease it back on a monthly basis,” Lieber says.
Despite its increasing popularity and widely acknowledged benefits, the equipment lease remains a misunderstood business equipment financing technique. Because of its power and flexibility, every business owner and finance professional should understand how leasing works and, more importantly, how it can vastly improve a company’s financial leverage.
Today, just about any type of commercial equipment can be leased across the entire spectrum of industry. Programs can be tailored to keep the payments affordable, and this form of business capital is much easier to come by than other types of business financing, particularly for companies that do not meet the increasingly stringent requirements for bank loans.
Leasing comes in all shapes and sizes and can vary widely in both the types of equipment and size of the transactions they work with. A micro-ticket company, for example, leases between $1,000-$25,000, whereas a large ticket lease company usually deals with leases of $5 million or more. There are computer leasing companies, companies that specialize in industrial equipment, construction machinery, business vehicle financing, and so on.
If you don’t have the time or desire to search for your own equipment lease financing, you can let a lease or commercial finance broker do it all for you.
Lieber’s final advice: “Try to find a company who is a direct lender and maintains its leases in their own portfolio. This gives a business owner the option to restructure the lease during its term if needed.”
About AEGIS Financial Solutions, Inc.: Since 1998, AEGIS Financial Solutions, Inc. has offered uncommon solutions to common problems using the fast, flexible and powerful resources of the cash flow industry and asset-based finance techniques. Helping people solve financial problems and get money when they need it most, without bank loans, is what we do best..
Mike Lieber, President
AEGIS Financial Solutions, Inc.
88 E. River Bend Road
Fredericksburg, VA 22407
PH: (540) 548-2270