2014 is set to be a strong year for equipment leasing and financing, a leading organization in the field has reported. The Equipment Leasing and Financing Association recently released a list of projections for the $827 billion industry this year, and according to ELFA, businesses are likely to invest more heavily in leasing than in years past.
ELFA compiled research data to inform the report, which named the top 10 trends they anticipate for the financing sector in coming months. The organization predicts investment in software and equipment will surpass past numbers, shooting to a record high of $1.5 trillion in transactions in the U.S. alone during the next year.
Businesses to capitalize on leasing opportunities
Furthermore, ELFA expects the majority of U.S. businesses will take advantage of available financing opportunities. Fifty-seven percent – or $860 million – of the $1.5 billion to be spent on equipment this year is anticipated to be leased through loans and lines of credit. These options are important for entrepreneurs to support supply chains across the country and can impact ability for future growth.
“For a majority of U.S. businesses, equipment financing is a critical source of funding, helping them to acquire the equipment they need to operate and grow,” William G. Sutton, president and chief executive officer of ELFA said.
The report also forecasted that demand for equipment financing will continue to increase as small and large business owners alike find improved stability in federal budgeting matters.
“The two year budget agreement passed by Congress reduces fiscal pressures and lessens the chance of a potential government shutdown, while a rising tide of economic growth will lift all boats,” the report stated.
As more equipment is purchased by leasing companies, business owners are likely to increase demand for leasing as an option to replace outdated equipment, as another benefit of equipment leasing is the general upgrades and fast paced growth in technology that continues to improve over months and years.
Rather than having to invest up front for new equipment that may be obsolete soon after, companies can lease technological and industrial equipment, granting them the freedom to replace these goods at their own pace. Some advancements ELFA predicts will take place include cloud and mobile technology use, improved business intelligence and options to assess internal company data. By taking advantage of these tech solutions, leasing companies and business owners alike will be able to cater to their customers more efficiently and effectively.
One of the greatest benefits of financing is that entrepreneurs are not tied down to the equipment they lease, due to the fact that they do not have to fully financially commit to any product. Whether they find a particular piece of equipment does not suit their needs or they feel the desire to upgrade to a newer model, individuals can transition from one option to another without being obligated to stick with any one product. For more information on financing options, contact National Funding today.
