My Calendar Free email Leasing Leasing companies, as well as banks and some suppliers and vendors, will rent equipment and other business assets to small businesses. Some manufacturers have leasing agents who may be able to arrange lease terms or a credit arrangement with the manufacturer, a subsidiary company, or a specific lessor. Leasing assets, rather than purchasing them, is a form of financing because it avoids the large downpayment frequently required for asset purchases and it frees up funds for other business expenditures. However, you should be aware that leasing from conventional lenders may be difficult for startup businesses because traditional lenders require an operating history from prospective lessees.
Many leases require little or no downpayment.
Leasing thereby allows you to direct cash toward other business expenses and investments. An improved cash position can also help your ongoing ability to obtain additional debt. Cash flow and expense-related financial statements will show only lease amounts as they come due. The relative absence of business debt will improve your chances for conventional loans. For businesses in which rapid technology changes or new equipment is common, leasing allows you to minimize the costs of purchasing equipment that is quickly antiquated.