Landscape and Irrigation is read by decision makers throughout the landscape and irrigation markets — including contractors, landscape architects, professional grounds managers, and irrigation and water mgmt companies and reaches the entire spetrum.
Issue link: http://read.dmtmag.com/i/792045
26 March 2017 Landscape and Irrigation www.landscapeirrigation.com BUSINESS RESOURCES ■ BY DAN GUNDACKER Landscapers are prepping for warmer weather, and using the weeks leading up to spring to evaluate their fleets and make appropriate new equipment acquisitions. While it may seem like the toughest decision is which model to purchase, do not overlook another important factor in assessing business impact: how will you go about financing your equipment? There are many options for landscapers, depending on whether they prefer to pay for a machine in cash, or spread payments out over time through leasing or an installment loan. While each option has unique pros and cons, many contractors utilize financing in order to sustain cash flow over time. Financing is a great payment option for landscapers looking to spread out payments over a longer time period, allowing the opportunity to generate revenue as they pay down the balance. Work with your dealer to select a machine and identify your options. Most manufacturers either offer their own financing, or have relationships with lenders that can assist in streamlining the process. There are three financing options from which to choose: leasing, installment loan, or revolving loan. An operating lease is a long-term agreement, typically a two- to three-year term, enabling you to make a fixed payment over a predetermined amount of time. At the end of the period you can exercise the purchase option, buy the machine and continue using in everyday business, or return it to the dealer — similar to automotive leases. Depending on the term, operating leases offer lower payments than installment loans of the same term, improving cash flow throughout the year. Many landscapers find leasing attractive because it offers multiple business benefits. Because leasing encourages landscapers to rotate machines every two to three years, their equipment fleets have newer equipment, helping to eliminate the risk of potential downtime. Many dealers are able to match lease terms with warranty periods, ensuring the machine is under warranty during the entire length of the lease. Financing Your Equipment How to evaluate your business and choose the best option While it may seem like the toughest decision is which model to purchase, do not overlook another important factor in assessing business impact: how will you go about financing your equipment?