How To Update Your Business’ Equipment When Funds Are Tight
Would a farmer tilling the soil by hand be able to compete with a factory farm? Probably not. From farming to IT, businesses in just about every industry must have the most advanced equipment if they hope to compete. But, how can you afford to update your tools of the trade with a shoestring budget?
Talk to the Equipment Manufacturer
Many manufacturers are sympathetic to the needs of small businesses. For instance, Apple recently announced a financing program to help organizations obtain and implement financing as well as select the best computers for their purposes. Their goal is to support start-ups and more established companies get the tech equipment they want with a minimal upfront investment.
Part of the Apple program is that every two years businesses can refresh their tech equipment. Rather than upgrading some systems and replacing others while battling cash flow challenges, businesses are charged a monthly rate that is easy to budget for and predictable. Plus, all of the products receive AppleCare coverage. It’s clear that Apple is making a move to challenge the dominance of Microsoft in offices across the globe.
Apple is not the only equipment manufacturer with programs like this. Reach out to the top manufacturer of the machines you use to do your work. You may find that they have financing options that make replacing your current units affordable.
Get an Equipment Loan
If you can’t work directly with a manufacturer, then you may want to turn to a third party to apply for a small business loan for your equipment. These short-term loans are secured by the equipment itself. You don’t generally have to put up other collateral. The lender simply repossesses the device if you don’t pay back the loan.
There are several benefits to going with an equipment loan:
- Fast answers –Equipment finance companies generally make quick decisions about whether they will deny or approve your application.
- Little documentation needed – You must have up to three years of profitable operation to get most business loans. On the other hand, equipment loans are much less restrictive, which makes them ideal for start-ups.
- Boost the asset value of your enterprise – With a large cash outlay, your enterprise enjoys a new asset immediately.
- Save money – You can often get an equipment loan with no down payment and potentially defer your first payment for 90 days.
- Get innovative equipment – The chances are that the latest machinery in your industry will save you time and money.