When you require equipment for your business there are a number of considerations. Borrowing through financing or leasing are common alternatives to buying outright. The considerations include initial capital cost outlay, the cost of ownership due to maintenance and upkeep, tax implications, financial flexibility, and even capital recovery.
When you start narrowing down on the type of equipment your business needs, it’s a good idea to thoroughly consider the pros and cons of leasing or financing versus buying. In certain circumstances, the cost-benefit of one option may strongly outweigh the other.
These are just a few of the pros and cons of borrowing to purchase equipment. Consider how long the equipment will be viable for your use and the overall costs. When you consider either method, include considerations of tax implications, potential resale, as well as the potential revenue derived from using this equipment.
Based on information from Intuit Inc. QuickBooks.