It takes a lot more to be a successful landscaping business than a lawnmower and some determination. A talented staff, great marketing, and up-to-date equipment are essential. Instead of cleaning out your cash reserves to purchase equipment, think about landscape equipment financing or leasing to get the equipment important to your business. You'll be able to protect your cashflow and give your landscaping crew the equipment they need to do their best work.
It's vital for you to have a fully equipped truck to haul around your equipment, tools, and materials. A business might have a lot of cash on hand now, but what about a few months from now when an unexpected expense arises? Or why not save your cash for things like payroll, marketing, or expansion? Landscaping equipment can be very expensive to buy outright, which makes landscaping equipment financing with Union Commercial Capital a great decision that can benefit your business.
Say Yes To Growing Your Business
Investing in newer, more powerful, or even additional equipment can add to your business capabilities and level of results. Whether you're looking to grow your existing business, or expanding your business, growth could happen virtually overnight with the right equipment and team in place. Do you subcontract out certain jobs and pay the overhead? This puts constraints on your gross margins and profitability. Don't you think it would be better if you could skip subbing out those jobs to someone with the right equipment? You should think strategically about which investments would bring the best type of business to you and how best to achieve the acquisition of the machinery. To set yourself apart from the competition, think about what your business could acquire to increase customer satisfaction and boost efficiency:
Commercial Mowers
Tractors
Compressors
Backhoe Loaders
Excavators
Trucks/Dump Trucks
Skid Steers
Track Loaders
Compactors
Commercial Edgers
Trenchers and more
Tips Before You Purchase Equipment
1: Have a Business Plan
Before you start picking out your equipment, make sure your investment isn't just a one-time shot. Make sure you look at your current market. How saturated or competitive is it? Is there opportunity for growth with the equipment you are looking to buy? Have you had indications that you are missing bids based on ability to service the whole job? Analyze your business plan and make sure you are doing this for the right reasons: to build your business and be more competitive.
2: Determine ROI ( Return on Investment)
The ROI (Return on Investment) for a piece of equipment or vehicle may not be as cut and dry as it used to be. As we previously discussed, you could expand your offerings or take on larger scale work with new equipment and become more competitive in your field, but how do you measure the ROI? It's essential that you build a model that focuses on capabilities-based ROI.
The basics of a ROI analysis are:
Establish the Initial Investment-Include all costs, besides the equipment, don't forget about shipping, installation, training, etc.
Estimate How Much Cash You Will Generate-This is the most challenging, but it's important in order to estimate the net cash this will generate for your business.
What is Your Minimum Return Required?-This is determined by looking at the cost of capital, project risk, and the opportunity cost of holding off of making other investments.
Evaluate the Investment-There are four ROI calculation methods: payback, net present value, internal rate of return, and profitability index. Select the one that makes the most sense for your project and the results will tell you whether the return is more or less than what you were expecting.
3: Preserve Cash Reserves
Your small business may be profitable, but that does not necessarily mean buying a piece of equipment outright makes good business sense. You do not want to deplete your cash reserves or create a cash flow issue during the typical ups and downs of your business. So, you need to determine if a lease or financing option makes the most sense for your business.
Work with a lender that can offer flexible financing solutions that match your business needs, and the customer experience ease of simple applications, quick credit decisions, and low-to-no upfront costs. Your lender should have a variety of programs from financing and leasing to working capital loans, to help with acquiring equipment or support your marketing, expansion, and payroll needs.
Getting Started
To get started, submit a simple one-page equipment financing application. Once you are approved and decide you want to move forward, one of our equipment financing specialists will contact you to discuss your options. We offer friendly, customized financing options that are tailored to your business needs and budget. Request a free quote without impacting your credit score today.
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