The leaseback form of funding is an option for companies due to one simple fact: more companies have equipment as an asset than any other asset. As a result, they can leaseback the equipment and obtain funding.
When one considers what assets, other than human assets, the highest percentage of companies have, equipment comes out on top. Not a significant number of companies have commercial real estate with a high percentage of equity in it, nor do the highest percentage of companies have receivables they can factor, or accept credit cards with a volume against which they can obtain a significant amount of funding.
However, more companies have equipment as an asset than any other asset. As a result, companies are able to leverage this asset of equipment most readily, and a very high percentage of companies do not realize they can do this in order to obtain funding.
In addition, companies may obtain the most significant tax advantages by being able to write off the entire monthly payment, rather than just the monthly payment.
Types of equipment include industrial equipment, machinery, medical equipment and even computer equipment.
Since cash flow is in very short supply with most companies, why pay cash for equipment when it can be leased?
This capital can be instead used for more important company needs, such as inventory, employees, expansion, new markets, research and development of new products.
Small Business Loan Resources:
SBA Community Blog and Forum – Blog and Forums by the SBA, Small business administration. Questions can be asked and answers provided.
U.S. Department of Commerce – Helps american businesses become more innovative at home and competitive abroad.
U.S. Bureau of Economic Analysis – Provides statistics on consumer spending, corporate profits, travel and tourism and much more.
Entrepreneurworld – Resource for Entrepreneurs, including starting your own business, growing your business.
Bureau of Labor Statistics – Provides companies with up to date information on employment, demand, hiring, productivity and other information that may be useful to companies.
International Trade Administration – Creates jobs and economic growth by promotingU.S. companies abroad to governments in other countries.
More Small Business Loan resources:
Department of Labor – Provides information on many labor issues that can be useful to companies, such as insurance, regulation, wages, wage hours, compensation, safety and health
U.S. Patent and Trademark Office –U.S. office to file patents to protect a companies new or existing proprietary products.
U.S. Trade and Development Agency – Promotes U.S. Exports to Foreign Countries, please review if your company is interested in exporting goods to foreign countries.
CEO Refresher - A monthly newsletter on creative leadership ideas. Short articles, brief book reviews, models, management tools, quotations and commentary.
E-Network for CEOs – Online articles and much more for CEO’s
Public Radio Planet Money – All issues money related to the public.
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