All about Business equipment financing

Business equipment finance companies are most suited for customers with equipment financing needs as they prefer to own the equipment and also enjoy the tax benefits offered by the government. Therefore finding good business equipment finance is very important for any business enterprise. A good finance company offers a wide range of equipment leasing solutions tailored according to your company’s growth, which can include hire purchase arrangements and other customized products. Their structuring capability enables them to offer customized solutions which address the unique requirements of their business customers.

A beneficial deal with a finance company often leads to a long time relationship and if the business equipment finance provider is not bonafide or adept enough, there is a chance that business operations could be stalled. In fact, choosing the right company and finance arrangements can contribute positively to business profits and directly impact the success of the business.

Some of the considerations in choosing  the right business equipment finance company are :

·         The company should be a single reliable resource who can address all business financing needs like equipment finance, working capital requirements etc.

·         A lot of research must be done regarding a finance company’s financing abilities, industry specific experience, years of experience and track record of their success.

·         The company should provide exemplary service and should be able to offer prompt and honest service under all circumstances.

·         Their process of financing should be already established and they should assist with completing the paper work formalities.  They should educate you on the different options out of which you may select a deal based on their recommendation.

·         The plans offered for equipment finance should be flexible and should be suitable to the needs and requirements of your company. Contingency plans like the freedom to lengthen the term of loan without any penalty should also be considered.

·         Lastly the finance company should be able to finance the equipment's as per your needs so that you have access to the latest equipment which will benefit the company’s interests in the long run.

The different finance company structures in Australia  are:

1.    Bank affiliated:  They are able to offer very competitive interest rates and are also good for relationships – especially if it’s your bank and you have open credit availability.

2.    Independent : An independent finance company can offer greatest work ability, and will finance almost all equipment at very competitive rates although not as low as the banks .

3.    Brokers – are generally considered to be the most expensive lenders because they act on behalf of another finance company or a bank . They have to get approval from the source lender who actually finances the equipment.

4.    Captive – These  types of finance companies belong to the equipment manufacturers  and so provide very low interest rates because they can manipulate the selling price of the product. They finance only their own products and will not lease products from other manufacturers. They may also become a manufacturer’s controlled finance company in which the rates are controlled by the manufacturer so as to benefit the customer.