When you think about the financiers that power the American economy, you might go to the names that grab the headlines. Fancy investment banks or global commercial banks might race to the top of your mind, and to some degree that’s true. But if 80% of all employment comes from smaller businesses, who is helping them? Who is making the capital available, so that the small business owners’ dreams can be realized, or the big new contract can power the growth of a company from small and stable, to stable and flourishing? The answers might surprise you.

41% of all small business loans are for equipment and technology. Equipment is a critical ingredient for business success because it drives efficiency, productivity, and in many business models—revenue. Businesses can’t take on a new contract without the equipment to gear up manufacturing. Construction companies can’t move dirt in two different jobs with the same equipment.

Most businesses realize that investing cash reserves for depreciating equipment is a less than desirable outcome… and these are just some examples of why more than 40% of loan requests are for equipment.

Equipment Lending Entities are estimated to fund $1.2 trillion globally, up from $490 million only 15 years ago. There are a multitude of reasons why businesses increasingly count on these “specialist” lenders, but a few of the more important reasons are:

  • Financial Benefits: Tax depreciation benefits, preservation of cash, aligning needs to challenging budgets, and a more affordable way to scale their business are just some of the benefits these lenders can bring. Because they understand the equipment that is in use, they can create more flexible financial solutions that maximize cash flows while minimizing cash investment up front. This benefit is an absolute staple of financial management success for smaller businesses.
  • Ease & Speed: Smaller businesses can fund equipment needs in days, rather than waiting for weeks just for an approval. With simpler application processes and faster decision making, smaller businesses can move faster in the marketplace by ramping up to grow business quicker and more affordably.
  • Equipment Knowledge: Increasingly, smaller businesses understand that managing the replacement cycle of their commercial equipment can be a challenge. Understanding how long they might use an asset, how they dispose of the asset at end of life and how to manage the finances during that “useful life” to achieve not just their financial goals, but their operating objectives are handled far easier when working with a lender that understands and specializes in equipment.

Commercial Equipment Lenders help power our economy, and it might be time to think about how one of these specialist lenders can power your economy.

We’ve offered uncomplicated financing to smaller businesses and commercial equipment dealers for more than 30 years. While part of a trillion-dollar powerhouse industry, our success is built one business lending need at a time–person to person, and year after year. Perhaps we can assist you. If so, contact us anytime!

Business Lending Central

About Business Lending Central

A blog serving the Equipment Leasing & Equipment Financing Industry while also analyzing related Business Loan / Commercial Lending Products & Practices