Commercial equipment rental vs equipment leasing
If you’ve made the smart decision not to tie up capital in commercial equipment, you now must weigh the option of equipment rental against the more common financing option: to lease equipment.
Lease equipment may look like a good idea at first glance but you need to take into account the full impact equipment leasing will have on your business.
Equipment leasing requires Directors’ Guarantees – which puts your personal assets (your home) on the line. Our equipment rental agreement for smaller contracts does not require Directors’ Guarantees
Renting vs Leasing
| Equipment Leasing
|| GoGetta Rent.Grow.Own
| × Long-term contract
|| - 12 month contract
| × Directors’ Guarantees
|| - No Directors’ Guarantees required on smaller contracts
| × Balance Sheet Item
|| - 'Off-balance' Sheet Item
| × Penalties if break-out before end of contract
|| - Purchase the equip at any time with no penalties
A lease is a balance sheet item – which reduces your equity, your ability to borrow and, accordingly, your availability of working capital. Rent is an 'off-balance' sheet item (like salaries or electricity). This means that equipment rental contracts have no impact on your equity, or on your ability to borrow.
An equipment lease requires a lot of paperwork and binds you into a four year equipment lease contract. A GoGetta Rent.Grow.Own® Agreement involves minimal paperwork, meaning you can get the equipment you need immediately. Our equipment finance gives you freedom, unlike equipment leasing or equipment hire, and you have the option to buy at a later date. As you can see, equipment rental offers a level of flexibility that neither purchasing nor equipment leasing can match.
To learn more about how our equipment rental option can improve your availability of working capital – and, accordingly, increase the rate of growth of your business – contact us today!
To demonstrate how equipment rental is the smarter finance option over equipment lease, see what your repayments will be with our Rental Calculator.