Being a business owner is not an easy role. The success of your organization relies on the decisions you make, especially when it directly affects your financial outlook. From the small investments, like whether or not to provide a coffee maker in the break room, to the larger commitments, such as whether or not to expand office space, the pressure is on you to cultivate a thriving operation.
When it comes to choosing technology equipment for your business, even the word “technology” conjures up visions of dancing dollar signs jumping out of your wallet. The costs of hardware and software can add up pretty quickly depending on the number of employees and licenses you will need to give out. Unfortunately, there is no way around it; technology is a part of everyone’s daily life and they are only getting more and more dependent on it to function.
Luckily, leasing technology equipment helps offset big spends by spreading the costs out over time. In fact, by optioning to take lease agreements over purchase receipts, you will open your business up to a world of benefits, particularly in the realm of technology.
Low Initial Costs
Although it is unreasonable to think that you can get away with not spending a decent amount of money on equipment and supplies, there are alternatives to buying everything outright. If your industry requires quite a bit of in-house production, purchasing the equipment necessary to manufacture products, or provide services, could make or break your budget.
Instead of buying the machinery outright and paying the entire cost of the technology equipment upfront, you will be able to spread payments out over an agreed upon duration of time. This way, you will not have to worry about wasting all of your cash in one fell swoop.
This alternative to buying equipment also means that you are freeing up cash. You may need the extra money for other important expenses, such as hiring employees, stocking inventory, or expanding facility space. Additionally, your lines of credit are also freed up for other necessary purchases.
Planning your annual or monthly budget also gets much easier when you choose to lease equipment. Since you know how much you will need to set aside for payments each month, you will not have to worry about surprise costs, including technology upgrades.
This is an ideal situation for small businesses or those with tight budgets. You need to make sure that you are making the most out of every penny and sticking to the financial plan you have created for your company. It is also a helpful indicator for long-term budgeting and being able to plan further into the future.
The key point to remember is that technology continues to evolve. You need to be flexible, especially if your goal in business is to maintain a competitive advantage. So, when it comes to technology, leasing your equipment is probably the best option. A piece of hardware can become obsolete within a short period of time. This may even happen on a yearly basis.
If you spent a lot of money on a piece of hardware that quickly becomes irrelevant, you may not be prepared to dish out even more cash in order to purchase new equipment so soon. It does not make sense to invest in machines, software, or other types of technology that are constantly being updated with new versions.
If you purchased your equipment, you might run the risk of falling behind your competitors, and, even worse, losing valuable productivity time. Leasing equipment allows you to easily upgrade to new models, or even switch brands if you want to try something new.
Technology is the root of every modern-day company. If you are not constantly pushing to be ahead of the curve, then you might find yourself fighting for market share. By leasing technology equipment, you can be sure that you will always have the latest software and hardware to keep your organization on top.
About the Author: Nancy Peckham
Nancy began her career in telecommunications in 1983 as an account executive with Republic Telecom, a regional long distance carrier. She was named district sales manager for the Wisconsin region in 1987 when Republic Telecom was acquired by Mid American Communications. She recognized a need for independent, objective telecommunications consulting which led her founding Valicom. Since its launch in 1991, Valicom has been a leader in providing telecom expense management solutions and serves enterprise and mid-market clients in a variety of industries and verticals across the U.S. Nancy earned a bachelor’s degree in psychology from the University of Wisconsin-Madison, founded and served as president of the Telecommunications Professionals of Wisconsin (TPW) from 1989-1992, and was executive vice president on the board of directors of the Society of Telecommunications Consultants (STC). Nancy is also a founding member and executive council chair of the Independent Telecommunications Expense Management Association (i-TEM).