The most important problem being solved is that while buying a new truck we will not have to pay the lump sum amount, we can pay in installments. With growing businesses, you are compelled to add another service truck to your fleet of transportation. With enough capital money, you are not sure to invest totally for the purchase or instead use truck finance as an option.
Here are some reasons, which may help you decide –
#1. Low cash investment required
The cash in hand is the main concern for many businesses, no matter how large or small the business. Most businesses cannot afford to complete the purchase in a single payment. Hence, truck finance is a great option to consider when thinking of purchasing a truck for business expansion purposes. Truck finance not only reduces the down payment amount but also helps in making payments in installment, which is a great method to divide the burden of capital investment. This reduces the initial investment of cash.
#2. Tax advantages
Truck finance is beneficial for us in many ways, one of its major benefits being tax benefits. According to law, companies purchasing trucks through truck finance can deduct the full purchase price of the equipment brought from their gross income during the purchase year, without even making the full payment.
Another tax benefit of truck finance is that we can start writing off the depreciation of the equipment from the year of purchase without gaining full ownership. This means, as the value of the truck goes down you start owing less and not the other way around.
#3. Flexible expense planning
Truck finance allows you to make plans for your purchase according to your company’s affordability. This is best for small business, as they often face problems when it comes to making payments for their purchases. Many truck finance companies also allow you to reschedule your payment dates. This reduces the burden on your business and allows the business to flourish prosperously. When you opt for truck finance, it helps to stabilize your expense reports allowing you to judge what you can and cannot afford.
#4. Builds equity
When handling finance one has to be very careful. Proper financing can give you unimaginable benefits whereas; improper finance could cause huge losses.
While handling truck finance, the most important and the trickiest part is concerned with the down payment of the equipment. It is important to know that the down payment we make is within the capacity of our business and would give profits in future. With proper truck finance, it ends up building equity for the business through its various benefits. It is an investment in business with high returns, which would eventually make our business prosper more.
Once the equipment is used up to its limit, we look forward to disposing it off. With truck finance, the process becomes easier. Truck finance managers take up the responsibility of disposing of the truck at the highest prices. This ensures the safety that even after the equipment is not working truck finance will always benefit us in the best possible ways.
When using truck finance as an option, your ownership rights are not threatened. You will be using the trucks as you would if you had paid the lump sum money. You will be allowed to use the trucks for any time and for any distance.
Hence, it is advisable to use truck finance as an option when thinking of buying a new truck. It is not only safe but also beneficial for both large and small businesses.