Skip to main content

Why buy when you can borrow?

There are many reasons why businesses like to own their equipment, but the benefits of leasing rather than buying can be considerable – especially when equipment has to be regularly replaced or upgraded.

Leasing is an obvious option for any business that wants to optimise its cash flow. There has been a clear trend in recent years away from asset ownership towards cost-per-use as businesses realise that they need to manage their working capital in a different way in order to keep cash on hand in case of need.

This approach to asset acquisition is particularly useful when a business needs a specialised piece of equipment or a high value asset to fulfil a contract over a limited period of time.

Spreading the load

Increasing productivity is vital to maximising the profitability of any business. As we have discussed in previous blogs, there is no point working harder or longer if your output does not improve.

However, one of the best ways of maximising productivity (acquiring a new piece of machinery or equipment) will put considerable pressure on cash flow if you choose to pay for it upfront. With so many businesses struggling to cope with the economic impact of coronavirus the chances of customers asking for longer payment terms is higher, so using an asset finance product such as leasing to acquire equipment will allow you to spread the acquisition cost over a much longer period.

In sectors where ongoing investment is essential to remaining competitive, leasing can provide access to new equipment without the capital expenditure. The asset finance provider takes the risk on how much value remains in your asset at the end of the contract.

Making leasing more pleasing

Lease providers have introduced a variety of initiatives to make their services easier to access, including simplifying the application process, allowing customers to sign their documents electronically and giving them access to their contract details via online portals.

They also offer flexible leasing solutions to match customers’ requirements, whether they are looking for single asset financing or larger, multi-drawn down products.

If you have encountered difficulties obtaining funding from your business bank you might find asset finance more accessible. You may also be able to agree a payment structure that is specific to your business’s circumstances or industry trading patterns, which could result in either lower monthly repayments and a lump sum, or the ability to spread the cost quarterly.

The power of information

Whether you lease or use another form of finance, finance providers will base their decision on your current cash flow and outgoings. Using a cloud-based accounting solution such as Big Red Cloud will make this information much easier to access.

Maintaining up-to-date accounts makes the process of applying for asset finance less painful. It also means you have a more accurate picture of the financial health of you company, which can help you make more informed decisions about other aspects of the business.

Marc O'Dwyer

After completing a Graduate program in Marketing, Marc’s impressive sales career began at Allied Irish Banks, Pitney Bowes and Panasonic where he received numerous Irish and European sales performance awards and consistently exceeded targets and expectations. In 1992, Marc’s entrepreneurial spirit led him to set up his own business, Irish International Sales (IIS). Initially, this company was a reseller for Take 5 Accounts and Payroll software. Within four years, IIS became the largest reseller of Take 5 in Ireland, acquiring four other Take 5 resellers. He also found time to set up two mobile phone shops under the Cellular World brand and a web design company offering website design services for small businesses. In 2001, he bought the majority share in a small Irish software business, Big Red Book. At that time, the company was losing money. The company became profitable within two months, and Marc then acquired a payroll company to compliment Big Red Books Accounting products. In 2003, IIS were appointed as Channel Partners with SAP for their new SME product, SAP Business One. Marc sold his Take 5 business and concentrated on developing this new market for SAP As a result, by 2007, IIS was recognised as the largest Channel Partner for SAP in EMEA (Europe Middle East and Africa). In 2008, the IIS Sales Manager bought the Company from Marc in an MBO. He launched Big red cloud in June 2012, the online version of big red book, to date the company successfully converts 59% of trials into sales and the number of customers is growing rapidly. Marc continues to run both Big Red Book and Big Red Cloud which now support 75,000 businesses. He is a very keen sportsman, having played rugby for 20 years, represented Leinster at under 16 and under 20 levels, and league squash with Fitzwilliam Lawn Tennis Club for 10 years. Marc has competed in 11 Marathons, including the London and Boston Marathons, and has completed several Triathlons and Half Ironman races. He has also completed six Ironman Races in Austria(x2), Frankfurt (Germany), Nice (France) , Mallorca (Spain) and Copenhagen (Denmark)

This site is registered on as a development site. Switch to a production site key to remove this banner.