When you choose a course of action for your business, typically your first priority is value. You want to try to get the most out of your money, so wherever you can, you try to cut costs and save. But when it comes to equipment finance and purchasing, that’s not the best way to go about it. Most rates fall in a pretty small range, so there are more important things to take into account than cost. There are two categories of relevant concerns – one will be covered in a later blog, but the other is the partner’s general reliability.

To improve your business and stay ahead of the competition, you need to purchase new equipment from time to time. The problem is that with purchases like this, you expose yourself to depreciation and your cash flow can become constrained, which can result in your business being overextended.

For readers unaware, fiscal cliff is the popular term used to describe the complicated issue that the U.S. government would face at the end of 2012, when the terms of the Budget Control Act of 2011 were scheduled to go into effect.

SECRET 1:

Banks are more than happy to have you use your line of credit for short term liquidity issues or for ease of use, but with rates at all time lows companies should not finance long term assets with their line of credit.

For those unfamiliar with the acronym, I’m referring to the one of the most common objections in the equipment finance industry, Personal Guarantees.

When acquiring equipment, businesses have a choice in how they pay for it – cash, bank or alternative means such as a broker or independent leasing company.  In many cases, businesses say they are using cash or budgeted funds when they are actually using their open capacity at the bank.  That isn’t always the best choice.

To whom it may concern,

I have worked with Ed Testa in the graphic arts field for 30 years. I have utilized
Ed directly for customer sales, for inventory financing and for national dealer
campaigns. Ed is a straight shooter and a great resource on equipment financing.

Ed has developed a strong following among equipment suppliers, customers and
industry professionals. He is creative in the sales process and follows through on
what he says. I would recommend Ed Testa without hesitation for financing needs.

Sincerely,
John Doherty
HD Associates

Read More testimonials to find out how the Connext Experts can help you with equipment financing & leasing.

If Congress continues in its deadlocked ways, come New Year’s Day, people will probably quit talking about Section 179 and Bonus Depreciation. However, for now, you may still benefit from these popular and soon to expire expensing allowances.