Save Your Business Budget Through Equipment Lease

A survey conducted by The Equipment Leasing Association reveals that many businesses in the US lease equipment, from the smallest office device like the laptop to the largest machines and vehicles. It has been reported that more than $200 billion worth of equipment are leased each year.

If you are a small business owner, here are some tips on how you can save more from your equipment lease:

1. Choose the Right Leasing Company. Dealing with the wrong lease provider may cause unnecessary problems. For example, you may encounter delays with the approval of your lease application or with the delivery of your leased equipment. Some leasing companies may charge hidden fees or may not provide the best customer service.

To avoid such complications, it is essential that you shop around for potential business equipment lease companies with good reputation, stable financial condition, and an impressive track record of service.

2. Choose the Right Lease. Business equipment leases come in different forms and packages. You need to do careful evaluation to make sure that your lease contract matches with the needs of your business.

Before signing up for business equipment leasing, examine your contract and check the specific terms of your lessor particularly with regards to pricing, repayment terms, and the conditions on obsolescence, end-of-lease options, customer service, termination, etc.

3. Choose a Short Term Lease. A shorter lease period will give you the chance to plan your next move and avoid getting stuck with a poor lease contract. When you receive your end-of-lease notice period, you can choose whether to return the leased equipment or renew you contract. The end-of-lease period may range from one month to six months so be sure that you are aware of the time frame. Otherwise, you could be stuck with an automatic lease renewal.

4. Cut Back on Your Interim Rent. The Interim Rent is a daily fee you incur from the time you receive the equipment to the official start of lease. One way to cut back the costs is to arrange the delivery of the equipment by the end of the month, since most lease contracts officially start at the first day of the month. You may also request your lessor to limit the Interim Rent for a definite number of days (10 to 15 days) regardless of the delivery date.

5. Check All Fees. See to it that you clearly understand all the fees associated with your lease. Examples of lease charges are commitment fees; non-use fees or facility fees, late rental penalties, early termination penalty, etc. Spend time comparing proposals from different lessors. If there are certain charges that are found in one proposal but are excluded in others, negotiate with the lessor if these charges can be reduced or completely waived.

6. Return or Buy Provision. Make sure that you will have the option to return or purchase the leased equipment at the end of your lease term. If you choose to return, will you incur additional fees? If you choose to buy the equipment, will you be given a reasonable price?

7. Ask for a discount. You can save a great deal from you lease costs if you ask for a discount. This is especially true if you have an excellent credit rating to back you up. Don't be afraid to negotiate with your chosen lessor. If you have been a customer for a long time, then surely you deserve the best deal.