Seasonal businesses play a critical role in the economy, from providing landscaping services in warm months to offering snow-related recreational activities in colder months. Because income is inconsistent, however, it can be difficult to figure out the best financing plan as you build and grow your company.
Here are four ways that equipment leasing can benefit your seasonal business.
1. Improve Your Cash Flow
When you lease your equipment, you’re only paying on a portion of the total value, which helps keep your monthly payments lower. Because of this, you’re not stretched as thin as you would be with a full-on loan. With lower monthly payments, you’ll be better positioned to stay on top of your obligations, even during your off-season months.
2. Keep Capital in Your Business
Equipment leasing doesn’t require a large down payment like an equipment loan typically does. This means you can keep your capital to use for other purposes. Whether you have other assets you want to purchase or want that extra cushion to cover payroll during slower periods, you’ll feel better knowing you have that cash in the bank.
3. Rely on Fixed Payments
Many loans come with a floating rate, which can drastically change your monthly payment. For seasonal businesses, this can be an unpleasant shock, especially if there’s a rate hike during a slow time when you least expect it. Equipment leasing comes with a fixed rate, so you know exactly how much you’re expected to pay each month for the duration of the lease.
4. Avoid Business Size Requirements
Most equipment leasing companies like CMS Funding don’t have a requirement for business size when it comes to the approval process. Even if you run a one-person landscaping business, you can apply to lease your equipment. This is a great choice, not only for getting your business up and running but also for growing at a scalable pace. As your customer base increases, you can lease the right amount of equipment to meet your needs.
Don’t assume that equipment leasing isn’t right for your seasonal business. It can actually provide you with financial relief so you can focus on growing your company.