OPEN FORUM: CASH FLOW AND LEASING
On OPEN Forum, Trent Hamm urges business owners to assess your options before leasing equipment. Use his questions as a guide to making your decision.
OPEN Forum Excerpt:
One of the most common pieces of advice given on business management websites when it comes to cash flow discussions is to lease your equipment. The argument in favor of leasing is straightforward: the month-to-month cost for leasing equipment is substantially lower than buying it.
There’s one key problem with this argument, though: leases put you into a never-ending cycle of payments, meaning that they are a somewhat smaller but never-ending drain on your monthly cash flow.
My advice when it comes to leasing for small business purposes is simple: use it as a tool in your repertoire, but only as a tool of last resort.
Before you lease, make sure you run through the following options.