In the years following the recession, more small businesses have safeguarded their working capital and have had a harder time getting loans. As a result, some business owners may be holding off on making major purchases such as equipment. In certain industries, such as manufacturing, having the most up-to-date equipment is important for making a profit. In a changing industry that relies heavily on efficiency, outdated equipment is detrimental to a company’s bottom line.
Companies that are seeking to grow still need to acquire the necessary equipment, even when market conditions are uncertain. That’s where equipment financing comes in. Compared to traditional lending from big banks, small businesses can find better terms for equipment financing through National Funding. Part of the reason that small businesses aren’t willing to take out loans is because they are not confident about taking on more debt. According to a recent survey from Sageworks, 62.4 percent of businesses said they wouldn’t apply for a loan for this reason. Nearly 25 percent said they didn’t think they would be approved, holding them back from applying for a loan.
Small businesses can better manage their cash flow and still receive new equipment for their operations through equipment leasing, without taking on more debt. A down payment is not required and a company has more options to upgrade later if newer equipment models come out.