How A Stand-Out Lessor Can Help Your Business
Friday, November 23, 2007
it If the equipment leasing company that your firm uses could make money for you or save you a bundle, wouldnt that company be worth its weight in gold? Sure it would. That firm would probably earn the loyalty of your firm.
Some leasing companies go the extra mile, delivering exceptional value to their customers. Here are a few ways stand-out lessors deliver great value:
Cost-effective Leases
Certainly, providing a competitive lease transaction that helps your firm to stay within budget and spread the leasing cost over the equipments useful life is a winning combination. The lease should also be flexible and user friendly. It should allow your firm to upgrade equipment easily and to terminate the lease in a cost-effective manner, should the need arise.
Convert Existing Equipment To Cash
If your firm has recent-model equipment that was not financed, why not convert the equipment into cash that can be used in your business? A skilled lessor can help your firm achieve that goal by structuring a sale-leaseback transaction. Under an equipment sale-leaseback, your firm sells equipment to the leasing company at the equipments fair market value. The leasing company then leases the equipment back to your firm under competitive terms. This type of transaction can be a win-win for both parties.
Achieve Higher Values On Unneeded Equipment
Your firm may have equipment that still has value, yet that equipment no longer meets your companys needs. Certainly, you can place ads in industry publications or otherwise attempt to re-market the equipment. Lessors that stand out can often help you re-market used equipment while achieving higher equipment values. Some lessors are active in the after-market of many types of equipment. They are often able to orchestrate the removal, refurbishment and sale of used equipment, while maximizing the re-market value.
Promote Your Business
A stand-out leasing company can help your firm excel by promoting your business. Some promotional activities offered by savvy lessors include: issuing joint press releases about the lease transaction, highlighting your firms offerings; including a testimonial from your firm on their website with a description of your companys activities; highlighting your business in their company newsletter sent to customers; introducing your firm to other leasing customers who might need your products or services; and hosting customer mixers to allow you to network with other customers.
Introductions To Key Financing Sources And Financial Service Providers
Leasing companies typically interface with many financing sources and financial service providers. They sometime call on other financing sources to check prospect credit references or to discuss collateral positions or lien releases. They also call on funding sources to originate new business, especially from sources that specialize in complementary financial services. Stand-out lessors stay on the lookout for high-quality lenders, private equity sources, CPA firms, attorneys, mortgage providers, insurers and others capable of providing excellent services to their customers. In many cases, like birds of a feather, high-quality financial service providers find one another and exchange business referrals.
How do you find a stand-out lessor? Make sure you ask the right questions when you meet lessors and when you check their references. Ask about the other ways they serve their customers. Also, when you make reference calls to check out new lessors, ask their references whether the lessors have offered any other helpful services that make them stand-out. While most lessors are skilled at selling their services, you will recognize the stand-outs by hearing from their customers.
George Parker is a co-founder, Director and Executive Vice President of Leasing Technologies International, Inc. (LTI). A twenty-five year industry leader, George is a frequent panelist and author of several articles and e-books, including "Using Venture Leasing As A Competitive Weapon" and "101 Equipment Leasing Tips".
Leasing Tips, Free and Otherwise
Tuesday, November 13, 2007
Spell out the Horse's Condition at the Beginning of the Lease: The lessee should get in writing the horse's condition at the beginning of the lease, via a veterinarian's pre-purchase exam. Otherwise, the lessee could get tagged as being responsible for a condition that the horse arrived with. These exams are not that expensive, under $200 typically, and will protect the lessee. Many latent conditions can surface during these exams, for example, vision problems or incipient lameness.
Discuss Insurance Issues: Discussing who is going to carry the horse insurance during the lease is important. Do not assume coverage without this discussion. Also discuss who is going to call the insurance company in the case of a possible claim. Insurance coverage might rest on quick notification, and so if the owner and the lessee have not worked this out in advance, then a claim could be defeated if notice is not given timely, even if otherwise coverage exists.
In Case Disaster Strikes: Discuss who is going to be responsible in the event of a major medical disaster with the horse. What if the horse colics? Who decides if the horse is to go to the hospital, and who is liable for those veterinarian bills? Is there an outside limit that will be spent? If the lessee has counted on the horse's availability and would be harmed by unavailability, would the lessee have any rights in these decisions?
Leasing Is Often Better Than Buying
Thursday, November 1, 2007
Leasing refers to an owner, or lessor, selling use of his property (equipment, automobile, home, or business) to a lessee. For many individuals, leasing is a good alternative to buying because leasing requires less equity and, therefore, more people have the qualifications to lease than to buy. For example, a $1 million piece of property may be too expensive for a business to purchase, so they lease it for $4,000 per month, which they are able to do with the profits they make.
Having the latest high-tech equipment is crucial for an IT company, so they may lease the best computers and have a continuing upgrade in their contract. This is much more cost-effective than regularly having to purchase the latest model, especially because computers are constantly being improved upon and the older ones become obsolete in no time.
Many other types of equipment, such as those used in construction, entertainment, weddings, and offices are typically leased to the user. Bulldozers, loaders, graders, and cranes are just some of the equipment needed when constructing a new building. If the building owner bought these items for the temporary use needed, he would spend hundreds of thousands of dollars needlessly. By leasing the machines, he is paying less and also being guaranteed service, repair, and maintenance on them.
Equipment rentals are a big part of the entertainment industry, from a child’s birthday party to huge corporate events. Many parents lease massive waterslides, cotton candy machines, and “moon walks” to enhance their child’s party. Corporations trying to impress clients host big blowouts complete with extravagant light shows, live broadcasts, and other huge presentations, all requiring leased equipment.
Weddings and bat/bar mitzvahs are other big sources of leasing needs. These events often require large amounts of silverware, linens, tables and chairs. Some even opt to have huge tents erected for their event, another leased product. A wedding typically has five or more vendors, all providing various leased services, such as catering, supplies, and music for the event.
Business leasing works similarly to home leasing. A person or company will buy a strip mall and lease each of the storefronts to different businesses, focusing on what sort of businesses will do well in the community and offering a variety of services on the property. The business owner would rather lease the store than buy it, because it is less expensive and the landlord will handle all service and maintenance of the building.