Does Lease Financing In Canada Really Work ? You Decide
OVERVIEW – Information on equipment finance solutions in Canada . Lease financing is touted as a popular way to acquire assets . Here’s how and why leasing an asset works.
Equipment Finance for asset acquisition in Canada is one of the most touted business finance strategies. Leasing assets via lease financing has numerous benefits and considerations that many business owners/financial managers never really truly consider. Let's dig in.
The ability to both run and grow a business often depends on the assets you need to acquire, or upgrade. Certain specific considerations must be made when entering into proper lease financing strategies - it's at that time that the owner/manager can truly achieve business economics that makes sense and provide a competitive advantage.
Almost every business in Canada, bit or small, new or established, uses assets to generate sales and profits. The decision points that revolve around the asset acquisition strategies you employ typically revolve around how your balance sheet looks, as well as your overall cash flow situation and the ability to get approved given you have other forms of operating or term debt .
Few businesses exist that don't utilize equipment finance - whether it comes down to corporate jets, shop floor equipment, lab equipt, technology... well you get the drift!
It's actually fairly easy to come up with at least 8 ' solid ' reasons to consider leasing your assets. While it would be rare for all these benefits to pertain to your firm we're quite sure many do. They include:
The ability to acquire assets with little or no down payment
Your firms ability to conserve valuable cash flow
The ability to manage the tech risk that comes with certain assets that evolve or need constant upgrading - (think computers/software, etc)
Utilizing lease finance as an inflation hedge
The ability to realize the economic benefits of assets without a 100% outlay in cash re having to purchase an asset
Managing the tech curve given constantly changing times
Balance sheet and income statement considerations
Using operating leases as a way to manage changes in tech in your assets
Many business owners or managers might feel their company or organization isn’t a user of equipment finance strategies. The reality? Whether you're a start up, Financial Post 100 firm, or a govt organization or non profit it's safe to say leasing assets is used in your sector.
What does the owner/manager need to do to asses a proper asset finance strategy? Typical considerations include:
Knowing how lease finance fits into your overall financial plan
Understanding how you will use the asset and for what period of time (leases typically are a minimum of 5 and a maximum of 7 years in term length)
Understanding whether you want to either own, or use an asset - Respectively capital lease and operating lease options need to be considered
If you're looking to truly succeed in asset acquisition a proper equipment finance strategy will help you reach that goal: seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you in lease financing strategies that make sense.
7 Park Avenue Financial :
Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations . Info /Contact :
7 PARK AVENUE FINANCIAL = CANADIAN EQUIPMENT FINANCE EXPERTISE
7 Park Avenue Financial
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Direct Line = 416 319 5769
Office = 905 829 2653
Email = sprokop@7parkavenuefinancial.com
' Canadian Business Financing With The Intelligent Use Of Experience '
ABOUT THE AUTHOR
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.
Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.
Stan Prokop
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