Plus One Reason to Finance Now
Most of our customers use financing rather than capital outlays to grow their manufacturing business, and they have a number of smart reasons for doing so:
1. Cheaper than Contracting Your Assembly Out
Companies can spend $10k and more a month contracting out their manufacturing, but you can typically bring an SMT assembly line in-house for a third of that when you lease or finance your line, and many companies already have a person on payroll who can operate the equipment.
2. Easier to Get the Go-Ahead
Financing typically requires fewer internal approvals than a capital purchase, making it the faster and easier route to an assembly line install or upgrade.
3. Increase Your Production Capability Sooner than Later
Rather than waiting until the money is there for a major capital outlay, with financing you can start the ball rolling on ordering, receiving, and installing your new equipment right away, allowing your company to benefit from increased capacity and capability much sooner than you might have otherwise.
4. Get Better Equipment
Financing gives you more purchasing power than a cash purchase. This means you can focus more on your goals than your budget.
5. Roll in Installation and Training
With a cash purchase comes the temptation to reduce costs, sometimes causing essential aspects like installation and training to be cut, but installation and training can have a big impact on how quickly your new equipment or production line gets up and running. Financing allows you to roll this cost into your payments.
6. Preserve Your Working Capital
Making a large cash investment in your production line leaves you with less ability to put that money to other strategic uses, such as growing sales and increasing inventory.
7. Improve Cash Flow and Expense Planning
With financing, your new equipment becomes a regular monthly expense item in the budget.
8. Obsolescence Protection
At the end of your lease term, equipment can be purchased at fair market value, upgraded, or swapped.
Plus, 1 Reason to Finance Now: Tax Benefits
U.S. companies who lease their equipment can often still take full advantage of the Section 179 tax deduction, which allows you to write off equipment as an expense rather than depreciating it over time as an asset. To be able to take this deduction for 2016, your equipment must be financed before December 31st. For more information on Section 179 deductions, visit http://www.section179.org/section_179_leases.html.
Manncorp has several financing companies we’ve developed a working relationship with over the years; they understand companies like yours. When you’re ready to upgrade your production capacity or capability, contact Manncorp to discuss your needs.