SHARE THIS STORY

More than 4 in 10 small business owners would prefer NOT to finance equipment with their bank.

While you might jump to conclusions about the reasons businesses look for alternative sources of equipment financing, you might be missing the point—preserving working capital relationships.

Banks are getting pretty beat up these days. While there have been a few bad actors, the overwhelming majority of bankers are still there standing firm for their clients. Sure, relationships are more complicated, but the average bank has had to increase their legal and compliance staff by more than 200% in the last ten years just to keep up with the new “strength” requirements of our government. For many businesses, it’s not that banks can’t help with equipment needs; it’s that adding additional debt might limit or strain the bank’s view of your lines of credit.

Your working capital line of credit is more than a lifeline. It’s your lifeblood at times. Peaks and valleys in operating cash flows can be challenging. Whether ramping up to meet a new customer’s requirements before the revenues come in, seasonality or long receivables cycles—your working capital line of credit allows you to access the funds needed to normalize your cash flows when things are anything but normal. But adding equipment or “term debt” to your relationships can give bankers pause about the overall relationship.

There is only so much debt a single lender can invest in your company. Even if you make all your payments, there is a magic “exposure” limit of risk lenders can’t cross. It puts them out of compliance with a regulation in an encyclopedia-like list of regulations. So, if working capital is so important to the cash flow balance of your business, why would you take a chance on disturbing that delicate lending relationship if there are more and potentially better options for equipment finance?

The key advantages of an equipment lender are:

  • Deep knowledge of commercial equipment
  • Finance alternatives that lead to lower payments, and improved cash flows
  • Less money required up front so you can preserve your cash for higher returning investments rather than depreciating equipment
  • Some equipment lenders offer MULTIPLE finance options with only one phone call, shielding you from these “lending exposure” issues
  • Speed. Often these lenders can fund your equipment need with more flexibility, faster than the bank can get the opportunity to their credit committee
  • You can preserve your delicate working capital relationship while having access to the financing needed to affordably put revenue producing equipment to work

At SLS, we’ve helped small businesses like your company succeed in uncomplicated finance programs for more than 30 years. While our finance programs are competitive and flexible, what sets us apart is our people. We may have Wall Street caliber financial resources…we’re Main Street kind of people. And maybe that’s why so many small businesses and dealers trust us time and time again.

If you want to know how to establish or grow a finance program for your company…let’s talk.

Contact Doug

Doug Fuller

816.423.8021

dfuller@slsfinancial.com

Free Web Development Tool – Equipment Financing Landing Page

SHARE THIS STORY

Ah, now we see you’re intrigued. FREE web development tool? That’s right. We’re not kidding around here. We’ve been implementing landing pages in our vendors’ sales strategies for some time now, and we want to get you involved too! If you’ve been curious by what you’ve seen on our blog so far, and are interested in working with us, this would be a great place to start. Check out the video above to see how simple the landing page process can be with SLS Financial.

We’ve been in this industry a long time, and we’ve done our fair amount of research. We can tell you 100% that equipment vendors that offer financing see an increase in sales… if it’s an integrated part of their sales process. Take a look at a few statistics we’ve gathered below:

Customers will not proactively bring up their need for payments and are more likely to go with a less preferred brand if payments are offered up front. A little shocking, isn’t it? That’s why we’ve developed our equipment financing landing page program. We want to make offering finance for your customers Uncomplicated. What’s more up front than a page easily linked from your website?

“We don’t want to drive customers away from our website.” We can work with that! We design the pages to match the look and feel of your website. Your logo, your colors, your pictures. This focus is on your business here. We’re just here to help. Once the design is complete, we can work with your webmaster to link the page to your domain, or we can host it ourselves. If you’re unsure, we can send over a draft design for you to make a more informed decision. Email Brian Soetaert, our Marketing Manager, for a sample: bsoetaert@slsfinancial.com

“We already have equipment financing with another lender.” That’s okay! We’re not exclusive. We’ve worked with challenged credits that have had a hard time finding financing in other places. Our program can round out any team quite nicely. What do you have to lose? It’s a free tool!

For a closer look at our templates follow the links below:

http://www.slsfinancial.info/landingpage1/

http://www.slsfinancial.info/landingpage2/

Thanks, and we hope to hear from you!

SHARE THIS STORY

Challenging equipment financing needs? Be one of the cool kids.

Growth stories are cool. Businesses finding ways to solve a problem in a unique way that leads to new revenues and growth—now those are the kids at the “cool table”.  As businesses look at their strategic and tactical plans for growth, here’s a thought that might help them be one of the cool kids:

  • Small businesses are 4 times more likely to describe their business as “growing” if they finance equipment over paying cash. (That is why that call it LEVERAGE!)

Business Growth with Equipment Finance

Businesses that finance equipment are growing faster and more frequently than those that pay cash according to a recent study.

Certainly, we all understand the peace of mind that may come with having no debt, but we also understand that when your company can’t leverage their position to take advantage of opportunity ~ they don’t grow. And that’s not cool.

Commercial lending rightly teaches that equipment depreciates in value over time. Of course, as it loses value you really have to ensure you are getting paid for its use to drive (ROI) return on investment. If a business pays cash and is typically only going to get a 5- or 7-year useful life from the asset, at the end of term you have 100% equity in an asset worth only 15-20% of the original investment ~

At the end of the day … Isn’t the point of investing cash to increase the value of the investment (ROI)?

If cash is tied up in fixed depreciating assets it is not being invested in areas that create stronger return. Or, put more simply – growth (ROI) is not maximized.

Companies that deploy equipment financing as a real strategy reap the following benefits (among others):

  • Stronger and more predictable cash flows
  • More cash on hand for higher return investments
  • They use newer equipment, driving efficient operations
  • They have fewer equipment failures
  • They have lower employee turnover (equipment operators prefer newer equipment without equipment failures)
  • Easier to bid on and scale new business opportunities because expenses more closely match revenues
  • They’re growing!

Successful Business People

At SLS, we’ve helped businesses and commercial lending brokers like your company succeed with uncomplicated finance programs for more than 30 years. While our challenged / story credit / B/C programs are competitive and flexible, what sets us apart is our people.

We may have Wall Street caliber financial resources…but we’re Main Street kind of people. And maybe that’s why we continue to enjoy great growth.

Apply-Now-Professional

Contact Doug

Doug Fuller

Doug Fuller

816.423.8021

dfuller@slsfinancial.com

SHARE THIS STORY

Have you noticed that there is a move toward optimism in real estate, and across the commercial and industrial landscape? We see it in increased demand ~ perhaps you do as well.

When it comes to the great engine of economic progress in America, optimism breeds action. Action leads to investment and investment to growth.

With that as back drop ~ Prepare yourself to win more business!

Bidding on more or larger opportunities require your business to have the financial infrastructure to execute on it. Since 2007 capital has been tight as lenders have been reticent to take risks. Slowly, this has resolved.

Even more so now because Optimism lowers risks for lenders. With that … Now is the time to evaluate your Capital Requirement needs and put a plan in place. We can help!

To begin; consider your organization’s financial position. Are you financially prepared to grow?

Do you have a commercial lending partner that helps you maximize capital as well as opportunity?

A great lending relationship should offer a scalable approach that allows for affordable growth.

At SLS, we have a long history of providing capital that powers the growth of businesses. Simple, fast, and competitive financing with a personal level of service that is a little old fashioned. Perhaps you could say that we keep things Uncomplicated. We believe that the spirit of American business assures better and brighter days are always just around the corner. No matter the business cycle, opportunity can be found. Presently, we see reason for abundant optimism … So, lets help one another ~ Let’s grow together. For any questions about how we can help with your real estate funding needs, call Doug. Furthermore, take a look at our real estate website for a deeper look at what we have to offer.

Doug Fuller

816.423.8021

dfuller@slsfinancial.com

SHARE THIS STORY

According to this article, “high growth of the telecommunication industry and increased prominence of the environment-friendly trenchless technology are expected to drive demand” and will help continue the growth of the industry as a whole from its estimated market size of USD 5.12 billion in 2014.

North America horizontal directional drilling marketing by end-use, 2012-2022, (USD Million)

Underground Boring Charts

With the many industries that tie-in to Underground Boring seeing growth as well (natural gas, power companies, telecommunication) it’s a good time to be thinking about your long-term strategy. Is your equipment up to the task of assisting all of these potential customers through this period of expansion? If not, how are you going to pay for it? “We have enough cash”. While that may be true, we’ve found that paying cash for equipment can actually be a drain to your business. Finding a good lending partner can help you acquire equipment using monthly payments, so you can free up your funds for other growth-oriented endeavors. SLS is a great option for used equipment, and we would be happy to help! In other circumstances, here are a few good options and the qualities of a good lending partner for your needs.

How to Find a Good Lending Partner for Underground Boring / Horizontal Directional Drilling

Ditch Witch Logo

Manufacturers: Manufacturers, like Ditch Witch, often offer financing themselves, and can be your best option in a lot of cases. Check the website of the manufacturer you’re working with to see if they offer financing for their equipment.

Bank Logo

Your local bank is usually a good choice, however, given that they may not be familiar with underground boring equipment, this may not be the path of least resistance. So ~ as you begin your search (under most normal circumstances) you should do the following things to determine if you are working with a quality equipment leasing / financing professional – see below:

Upfront Monies: If a lender asks for money upfront ~ you’re up the wrong money tree! Once you are APPROVED & receive documentation, then & only then should you send the lender any needed down payment or advance payment along with your signing of a credit-approved final contract.

Money Tree

Furthermore, check for the following ~

Reputation: That the commercial lender has a great reputation. But, how do you know? Easy enough ~ Google the company name and the city and state. You are just looking for complaints. Be careful if you see many (more than a couple) of these! If so, choose another.

Longevity: Has this company been around for 10 or 20 years or more? A seasoned organization, with no complaints is often a great way to go.

The Contract: Review the contract and verify that these are the final terms & that you are indeed credit approved. Verify too that they are ready to fund once you send in the final contract. If this is not the case … you’re better off with someone else.

PROGRAMS FOR EQUIPMENT FINANCE BROKERS

Once you find a credible lender it is time for underwriting.

Get a financing or equipment leasing quote and complete a credit application.

Many well-established lenders offer an online application ~ like this:

Online Application: Click Here

Terms and Payments for underground boring equipment can vary based on the amount of money involved and your overall credit profile.

Also ~ whether the equipment is new or used can sometimes impact the terms available for borrowers.

Payment Example ~

Underground boring equipment cost ~ $100,000 & a 5 year term –

  • Monthly payments will usually range from $2000 – $2500 (subject to credit approval, of course.)

Many National Commercial Lenders offer A, B and C Options and thus the differences. Financing terms are typically from 2 – 5 years. Here are some factors that aid them in underwriting a company’s credit application:

Time in business: The newer the company the greater the monthly payment.

Personal Credit Score: The lower the credit score the greater the monthly payment ~ all things being equal.

Approved Handwriting

Many other factors help a lender to analyze the risk associated with a underground boring professional applicant.

Usually the 5 C’s of Credit come into play when a lender analyzes an applicant.

Character / Credit: Personal and business credit scores and the like help the lender understand this C as it relates to an applicant.

Capacity: Show me the money! Capacity to pay is all about cash flow. Many underground boring equipment lenders ask for a copy of 3 recent bank statements. These are easy to obtain & forward thanks to online banking. This shows how much you are making & spending in each of the months presented.

Collateral: What is the equipment worth now and what will it be worth in the future? This helps to show a creditor the value of the collateral.

Conditions: Right now, conditions for the underground boring industry are positive. Your industry follows the economy to a great extent. Building is surging, as is the economy in general, so this is great time to be in your industry.

Capital: How much money or wealth do you have in your company?

Sound complicated? It doesn’t have to be! We have over 30 years of experience at SLS Financial Services helping people just like you finance new and used equipment so that you can focus on growing your business. If you’re ready to add the benefits of new equipment to your ever-growing business, we’re ready to help you make the process… Uncomplicated! We aren’t your typical commercial lender. We look at the person behind the application. If you have any questions about our process feel free to reach out to us at 816-587-3400 or you can find a link to our application below.

Apply-Now-Professional

Today, credit scoring systems can make credit decisions almost instantly. However, business is still about people. More than ever, business-owners seek (a) commercial lending partner to learn about their unique needs and be solution-providers.

Speed and technology are important, but do they come at the expense of leaving people, their story, and opportunities behind?

At SLS, we’ve never lost focus on the business-owner behind the application. A big part of our success is based on customer satisfaction ~ plain & simple, because we believe in leveraging technology and combining it with our expertise for only one purpose…to help people.

Call Doug for more information ~ 816.863.3070

Doug Fuller

President of SLS Financial, an accountant, former Board Member of one of the safest banks in America, and owner of multiple businesses.

For more than 30 years he has assisted buyers and sellers of equipment with competitive finance and commercial lending programs.

Contact Doug:

dfuller@slsfinancial.com

816.423.8021

SHARE THIS STORY

Let’s get this out of the way right off the bat – I’m a dog person. I can’t say it runs in the family though. On my mom’s side of the family, there are two households that have 2+ cats. Yes, we do get along, but the debate rages on… We all love our furry friends, no matter if we’re cat people or dog people. In fact, we love them so much that we’re spending record amounts on their well-being! http://www.nbcnews.com/business/consumer/americans-will-spend-more-60-billion-their-pets-year-n390181

Yes, we want to pamper our pets, but our connection goes deeper than that. We want to keep them healthy so they can be there for our big days, and cheer us up when things go sour. They’re our family, and we want to treat them as such. When your family is unwell, you take them to get professional care. In that regard, veterinarians are becoming a bigger and bigger part of the American economy. Maybe you’ve noticed an increase in demand recently?

As you know, there are plenty of pieces that keep the machine running, so-to-speak, and you need to stay up-to-date to become a trusted extended member of the family. The list of equipment necessary to give the best care to man’s best friends (and cats too) can get pretty extensive – we found a good resource here: http://www.dreveterinary.com/ – and we know that acquiring all of this equipment can get pretty expensive. How can it be possible to keep up with all of that ever-advancing technology without breaking the bank? With a little concept that is known as LEVERAGE. Let us explain:

What about the money? 

Leverage (borrowing) is a powerful tool when properly used (that is why it is called “leverage”).

For instance … financing equipment allows you to more effectively match revenues (from the use of the asset) with the monthly payments. It should much more than pay for itself to be a wise and prudent use of capital (capital is a fancy word for money). Cash flow (again a fancy word for money that is left after you made the payment and paid the bills) is an important consideration when analyzing a capital investment. So, imagine that you generate extra cash each month (free cash flow) from your acquisition of equipment. This is THE ANALYSIS to determine if an acquisition makes good business sense … all else being equipment ~  Is there free cash flow?  Is there money left after I paid the paid for everything associated with the new asset including the payments, the people and all other expenses (fuel, insurance, repairs, etc.).

 

For example:

 

Gross Revenue

Less: Payment

Less: All Expenses

Equal:  Free Cash Flow

 

At SLS … We hope to explain easy concepts in easy to understand terms. Leverage sounds fancy, yet it is really pretty uncomplicated ~ it is just simple math.

So, if you would like to have a straightforward conversation about commercial lending ~ call or email anytime and we will be glad to help!

Call Doug

Doug Fuller

dfuller@slsfinancial.com

816.423.8021

SHARE THIS STORY

As I’m looking out the window of my office, I’m appreciating an early summer day (and a break in the constant “April Showers” that somehow made it to May). Our main offices are located on the border of a Kansas City neighborhood, and a telltale sign of summer around here is the vast sea of large green leaves populating each tree as far as the eye can see… from my side of the building at least. Here at SLS, we appreciate the care that goes into keeping each of those trees in tip top shape. Trust me, we wouldn’t be reading arborist blogs in our spare time if we didn’t (check out http://www.kcarborist.com/blog/ for some good tips!)

Girl Admiring Trees

We also know that professional arborists require an assortment of gear to successfully complete their job – sometimes their safety depends on it (http://www.climbingarborist.com/blog_2lines.php). If you’re reading this far, you’re probably a professional arborist yourself, and you may be thinking about a few pieces of equipment in your arsenal that could use an upgrade, or maybe you’re ready to pick up some saws and pruners that you’ve been lacking. We certainly know that there are places out there that you can find a good selection of WHAT you need (like http://www.wesspur.com/) but we know acquiring your new equipment can be a pretty expensive ordeal. But you want to keep your business growing! Don’t let outdated equipment or a lack of equipment in general be what holds you back from success in your industry. An under-utilized tool in your industry is a GOOD lending partner, one that can help you turn that daunting price tag into manageable monthly payments that make your equipment feel like it’s paying for itself – and we’re here to show you exactly what that does and doesn’t look like.

Bank Logo

Your local bank is usually a good choice, however, given that they may not be familiar with arborist equipment, this may not be the path of least resistance. So ~ as you begin your search (under most normal circumstances) you should do the following things to determine if you are working with a quality equipment leasing / financing professional – see below:

Upfront Monies: If they ask for money upfront ~ you’re up the wrong money tree! Once you are APPROVED & receive documentation, then & only then should you send the lender any needed down payment or advance payment along with your signing of a credit-approved final contract.

Money Tree

Furthermore, check for the following ~

Reputation: That the commercial lender has a great reputation. But, how do you know? Easy enough ~ Google the company name and the city and state. You are just looking for complaints. Be careful if you see many (more than a couple) of these! If so, choose another.

Longevity: Has this company been around for 10 or 20 years or more? A seasoned organization, with no complaints is often a great way to go.

The Contract: Review the contract and verify that these are the final terms & that you are indeed credit approved. Verify too that they are ready to fund once you send in the final contract. If this is not the case … you’re better off with someone else.

Business Can Be Fun!

Once you find a credible lender it is time for underwriting.

Get a financing or equipment leasing quote and complete a credit application.

Many well-established lenders offer an online application ~ like this:

Online Application: Click Here

Terms and Payments for arborist equipment can vary based on the amount of money involved and your overall credit profile.

Also ~ whether the equipment is new or used can sometimes impact the terms available for borrowers.

Many National Commercial Lenders offer A, B and C Options and thus the differences. Financing terms are typically from 2 – 5 years. Here are some factors that aid them in underwriting a company’s credit application:

Time in business: The newer the company the greater the monthly payment.

Personal Credit Score: The lower the credit score the greater the monthly payment ~ all things being equal.

Approved Handwriting

Many other factors help a lender to analyze the risk associated with an arborist professional applicant.

Usually the 5 C’s of Credit come into play when a lender analyzes an applicant.

Character / Credit: Personal and business credit scores and the like help the lender understand this C as it relates to an applicant.

Capacity: Show me the money! Capacity to pay is all about cash flow. Many arborist equipment lenders ask for a copy of 3 recent bank statements. These are easy to obtain & forward thanks to online banking. This shows how much you are making & spending in each of the months presented.

Collateral: What is the equipment worth now and what will it be worth in the future. This helps to show a creditor the value of the collateral.

Conditions: What are the conditions of the industry and the economy as a whole?

Capital: How much money or wealth do you have in your company?

Sound complicated? It doesn’t have to be! We have over 30 years of experience at SLS Financial Services helping people just like you finance new and used equipment so that you can focus on growing your business. If you’re ready to add the benefits of new equipment to your ever-growing business, we’re ready to help you make the process… Uncomplicated! We aren’t your typical commercial lender. We look at the person behind the application. If you have any questions about our process feel free to reach out to us at 816-587-3400 or you can find a link to our application below.

Woodworking-Apply-Now

Today, credit scoring systems can make credit decisions almost instantly. However, business is still about people. More than ever, business-owners seek (a) commercial lending partner to learn about their unique needs and be solution-providers.

Speed and technology are important, but do they come at the expense of leaving people, their story, and opportunities behind?

At SLS, we’ve never lost focus on the business-owner behind the application. A big part of our success is based on customer satisfaction ~ plain & simple, because we believe in leveraging technology and combining it with our expertise for only one purpose…to help people.

Call Doug for more information ~ 816.863.3070

President of SLS Financial, an accountant, former Board Member of one of the safest banks in America, and owner of multiple businesses.

For more than 30 years he has assisted buyers and sellers of equipment with competitive finance and commercial lending programs.

Contact Doug:

Doug Fuller

dfuller@slsfinancial.com

816.423.8021

 

SHARE THIS STORY

What if businesses could have more or better revenue-producing equipment in service this year for a far lower net investment? Would it change how they look at your business? Bid on new relationships? Grow? In December 2015, Congress brought back the strength of the Section 179 Tax Deduction for businesses. Under the “Protecting Americans from Tax Hikes Act of 2015,” the Section 179 limit is expanded to $500,000 with additional benefits of bonus depreciation for amounts over $500,000. The new law will make this a permanent change, and that was really big news!

A quick primer on Section 179

The Section 179 deduction often allows small businesses (subject to specific limitations) to deduct upfront, rather than depreciate over a number of years, the cost of equipment such as computers, vehicles, manufacturing equipment, farm machinery, office furniture, etc. Additionally, the benefits of bonus depreciation and the incentive to acquire equipment and stay on the cutting edge of technology by continuing to buy equipment are significant.

Each year these assets need to be purchased and put into service by Dec. 31 to qualify for taking the deduction in that tax year. Please also note that businesses exceeding a total of $2 million of purchases in qualifying equipment will have the Section 179 deduction phase out dollar-for-dollar — and completely eliminated above $2.5 million. Additionally, under this law, the Section 179 cap will be indexed to inflation in $10,000 increments in future years. 50% Bonus Depreciation will also apparently be extended under this legislation through 2019 and will be phased down to 40% in 2018 and 30% in 2019.

The important takeaways

The impressive economics of the tax benefit might lead many to rethink equipment life-cycle strategies. Acquiring equipment for a lower net investment might prompt consideration for replacing equipment more frequently, upgrading to more effective technologies, and reducing the operating expenses associated with running equipment longer. By working closely with a tax advisor and an experienced equipment financier, many might be able to put more or better revenue producing equipment in service.

At SLS, we work with professionals every day to maximize equipment purchasing power— putting more revenue-producing equipment in service—with a simple and downright uncomplicated process. If you’d like to discuss how to leverage Section 179 to fuel growth in 2017, give us a call.

SHARE THIS STORY

Title photo from Barney Moss (https://www.flickr.com/photos/barneymoss/14008241153/)

Crack open a cold one, let’s celebrate a milestone! According to the Brewers Association, the number of breweries in the U.S. just crossed the 5,000 mark in the fourth quarter of 2016 in the United States. That’s not all, this is a NEW RECORD beating out previous records from 2015, and (believe it or not) 1873! Maybe let’s crack open two. (Source: http://fortune.com/2016/12/10/america-record-number-breweries/)

While this shows that the industry is thriving, it obviously also indicates that competition will be continuing to ramp up for the foreseeable future. How do you stay ahead of the game without your budding brewery going flat? Those full-bodied bocks, refreshing amber ales, and malty stouts are going to create some loyalty with the fans, but you have to plan for growth on the production side of things. Faulty or under-performing equipment can set your business back, while your competitors, both current and future, grab some very valuable market share in a climate where every customer counts.

There are many pieces of equipment you’ll need to reach the ranks of the vets. We found a great resource for learning about all of the components of great breweries here: http://jvnw.com/beer/

Wow, that was a little overwhelming! And these components cost what? Getting to a point in your business where equipment acquisition becomes a necessity can be pretty nerve-wracking, especially when it feels like these purchases are going to break the bank. Don’t fret. If you’re looking, it means you’re gaining momentum. With an established customer base and a great lending partner to help you leverage your microbrewery equipment with affordable monthly payments, your equipment will pay for itself, and you won’t have to stagnate while you work on ramping up. Let us explain a little bit deeper.

What about the money? 

Leverage (borrowing) is a powerful tool when properly used (that is why it is called “leverage”).

For instance … financing equipment allows you to more effectively match revenues (from the use of the asset) with the monthly payments. It should much more than pay for itself to be a wise and prudent use of capital (capital is a fancy word for money). Cash flow (again a fancy word for money that is left after you made the payment and paid the bills) is an important consideration when analyzing a capital investment. So, imagine that you generate extra cash each month (free cash flow) from your acquisition of equipment. This is THE ANALYSIS to determine if an acquisition makes good business sense … all else being equal ~ Is there free cash flow? Is there money left after I paid for everything associated with the new asset including the payments, the people, and all other expenses (fuel, insurance, repairs, etc.).

 

For example:

Gross Revenue

Less: Payment

Less: All Expenses

Equal:  Free Cash Flow

 

At SLS … We hope to explain easy concepts in easy to understand terms. Leverage sounds fancy yet it is really pretty uncomplicated ~ it is just simple math.

Figuring out how this applies to your microbrewery can be difficult to figure out without a frame of reference, so don’t worry, we’re here to help!

If you would like to have a straightforward conversation about commercial lending for your business ~ call or email anytime and we will be glad to help!

Call Doug

Doug Fuller

816.423.8021

dfuller@slsfinancial.com

 

SHARE THIS STORY

In a recent independent survey of 1412 Small Business Owners (less than $10,000,000 in revenue) that make at least 2 equipment purchases per year…

  • Companies that pay cash for equipment keep equipment longer
  • Companies that pay cash for equipment have higher maintenance expenses
  • Companies that pay cash for equipment have more equipment down time
  • Companies that pay cash for equipment have more employee turnover

Think about it–the longer you keep equipment the higher the maintenance expense. Higher maintenance expenses typically mean that there are “down time” expenses because of equipment failure. And while these events are occurring, small businesses are perhaps missing the single biggest negative impact.

The most damaging by-product of the “pay cash and run it till the wheels fall off” strategy is not rental expense, maintenance or even the pain of cash flow spikes—it’s employee turnover. As a business owner your single biggest expense is most likely labor. Your people. Finding good ones seems to be getting harder and the cost of losing and then finding another good employee is extremely expensive and disruptive to a small business. When your company is using older technology and equipment leading to issues of “down time” and inefficient performance—employees leave.

82% of 7,226 small business equipment operators (from entry level to advanced in industries ranging from construction to IT) said current equipment was a major factor in their job satisfaction.

No wonder the same research revealed that companies that paid cash reported higher turnover among equipment operators. Financing allows for companies to stay on the cutting edge of technology – a simple monthly payment for a period of time, only to replace the equipment at the end of the finance term with the newest model and/or technology. Financing executed the right way becomes a program to ensure your company and more to the point—your employees—have the tools to do the job.

And don’t sleep on the small stuff. Many times business owners wouldn’t think of not financing the $100,000 purchase, but are paying cash for the next 3 laptops or the used trailer. These items are often the most impactful to the employee experience and from a financial point of view can add up to be significant monies.

The right finance partner can help. For more than 30 years SLS has made commercial equipment more affordable for businesses like yours. And by opening your mind a bit, you might just build a better work environment along the way as well. Let’s talk.

Call Doug

Doug Fuller

816.423.8021

dfuller@slsfinancial.com

 

1 2 3 7