Owning and maintaining garage equipment can be expensive, especially for small businesses. The majority of the garages in the UK are small independent or family-owned, which can often make the initial investment required difficult to find.
Fortunately, there are financing and leasing options available for garage equipment, making it easier for businesses to acquire the equipment they need without breaking the bank. Whether through loans, lines of credit, equipment financing, or through operating or capital leases, businesses can spread out the cost of equipment over time and preserve their cash flow. With these options, businesses can stay up-to-date with the latest garage or MOT equipment and maintain their competitiveness in the market.
Loans: Business owners can apply for loans from banks, building societies, credit unions, or other lenders. Loans typically come with interest rates and require regular payments over a set term. The terms of the loan can vary, depending on the lender and the business’s creditworthiness.
Lines of Credit: A line of credit is a flexible financing option that allows businesses to draw funds as needed. The business owner can borrow up to a set limit and only pay interest on the amount borrowed. Lines of credit are often used for short-term financing needs, such as purchasing inventory or covering unexpected expenses.
Equipment Financing: A type of loan specifically designed to help businesses acquire the necessary Garage Equipment. The equipment serves as collateral for the loan, which means that the lender can repossess the equipment if the business defaults on the loan. Equipment financing can be used for both new and used equipment.
Leasing Options for Garage Equipment and MOT Bays
Leasing options allow businesses to take delivery of and use the leased equipment for a set period, typically 1 to 5 years. At the end of the lease term, depending on the type of lease, either the business can return the equipment or purchase it with a final payment, but with garage lease options usually the final lease payment means the equipment can simply then be signed over to the garage business.
There are two main types of leases: Operating leases and Capital leases.
Operating Leases: Operating leases are similar to renting. The leasing company retains ownership of the equipment, and the business pays a monthly fee to use the equipment. At the end of the lease term, the business can either return the equipment or renew the lease.
Capital Leases: Capital leases are similar to loans. The business makes regular payments to the leasing company over a set term. At the end of the lease term, the business has the option to purchase the equipment at a discounted price.
For garage equipment often the terms loan, finance and leasing are used interchangeably, and most garage equipment leasing arrangements are either a capital lease or a loan backed by the value of the equipment or other asset.
What is the Definition of Garage Equipment Finance?
Equipment finance is a type of financing that allows garages to acquire the MOT Bay or Garage Equipment they need to operate and grow without having to pay the full cost upfront. Using equipment loans you can buy, lease, upgrade or repair equipment quickly. It typically involves a lender providing the necessary funds to purchase or lease the equipment, and the borrower repaying the loan or lease over a set period of time, usually with interest.
What is Garage Equipment Finance Leasing?
Equipment finance leasing is a type of equipment financing in which you rent the garage equipment rather than purchase it outright. The borrower makes regular payments to the lender for the use of the equipment. It could be used, for example, to lease expensive MOT Bay equipment.
Is Financing Garage Equipment a good idea?
Depending on your personal and business circumstances, as well as your creditworthiness, credit score and available finances, financing garage equipment may be right for your garage business as it allows garages to acquire the necessary MOT Bay and other Garage Equipment, including ATL MOT lifts which can be a particularly large expense, without having to pay the full cost upfront. Depending on the lender you choose, you might get a convenient deal and you might not need to provide a down payment. Sometimes you can even do a deferred payment program.
Is it better to Buy or Finance Garage Equipment?
The decision to buy or finance equipment depends on factors such as your current financial situation, the type of equipment you need, and the intended use of the equipment. Buying MOT Bay equipment has the advantages of owning the equipment outright and being able to use it for as long as you need without any restrictions or additional interest payments. Whereas financing MOT Bay equipment has the advantage of being able to acquire the equipment you need without having to pay the full amount upfront, and it reduces the chance that your garage gets stuck with obsolete equipment. The latter also means that the garage equipment that you purchase can be making you money, whilst it’s effectively paying for itself.
How many years can you finance Garage Equipment?
The length of equipment financing can vary depending on the type of equipment being financed. Shorter-term equipment financing, such as one or two years, maybe more appropriate for budget Garage Equipment with a potentially shorter lifespan. Longer-term financing, such as five to ten years, maybe more suitable for more expensive premium MOT Bay equipment with a longer useful life.
What is meant by Garage Equipment Leasing?
Equipment leasing is a system in which MOT Bay equipment is lent to a garage for a particular period of time in return for regular payments. Equipment leasing can be an attractive option for garages that need access to expensive MOT Bay equipment but don’t have the capital to purchase it outright.
What are the Benefits of Leasing Garage Equipment?
There are several benefits to financing and leasing garage equipment, these include:
- Lower upfront costs: Leasing equipment allows garages to acquire the equipment they need without a large upfront payment. Instead, they can make regular, predictable payments over the lease term.
- Cash flow management: Leasing can help garages manage their cash flow by spreading the cost of equipment over a longer period of time. This can free up cash for other expenses and investments.
- Stay Up-to-Date: Garage equipment can become outdated quickly, especially with advancements in technology. Leasing allows garages to access the latest and most advanced MOT Bay and Garage Equipment without having to purchase it outright. This can help garages stay competitive and efficient.
- Tax Benefits: Both financing and leasing can offer tax benefits. Interest paid on loans and lease payments may be tax-deductible, and businesses may be able to depreciate leased equipment over time.
- End-of-lease options: At the end of the lease term, garages may have the option to purchase the MOT Bay equipment, renew the lease, or return the equipment. This can provide flexibility and allow garages to adapt to changing needs.
What are the disadvantages of Leasing Garage Equipment?
Leasing Garage Equipment can also have some potential disadvantages, including:
- Higher total cost: Leasing equipment may cost garages more in the long run than purchasing the MOT Bay or Garage Equipment outright. Leasing companies charge interest and other fees, which can add up over time.
- Limited control: When you lease equipment, you do not own it, which means you have limited control over how it is used. For example, you may not be able to make modifications or upgrades without the leasing company’s approval. Also, you may not be able to sell the equipment without either the full balance being paid or without the finance company’s prior agreement.
- Obligation to pay: When you lease equipment, you are typically required to make regular payments, regardless of how much you use the equipment or whether it is generating revenue for your garage. If your circumstances change then this extra overhead may become an unnecessary burden.
How do I get out of a Garage Equipment Lease Agreement?
The process of getting out of an equipment lease agreement will depend on the specific terms and conditions outlined in the agreement itself. Exiting an equipment lease agreement can be a complex process that may involve negotiating with the lender and potentially paying fees or penalties to exit early. It’s important to carefully review the terms of the lease agreement and consult with legal or financial professionals before taking out any financial agreement, and before taking any action to exit such a deal.
Finance and Leasing Options available from Concept Garage Equipment
- Full payment by BACS
- Pay by Credit or Debit Card
- Pay by Cheque
- Pay in 3 instalments using iwoca pay (available to limited companies)
- Pay on Finance (check how much this might cost you monthly using our online finance calculator)
Using one of our trusted garage equipment leasing partners, you are in good hands, to get the best and most flexible payment options for your garage equipment or MOT Bay, and once approved it’s a speedy process from start to finish and means that you can have your new MOT Bay or Garage fitted out with tyre fitting, maintenance or vehicle repair equipment, and earning your business money before you know it!
Need help finding the best leasing and finance options for your MOT Bay?
If you are looking to install new equipment or upgrade existing equipment, and need information on the best equipment to buy or information on companies that can help with leasing and financing the equipment then give Concept Garage Equipment today. We would love to help you find the best deals whilst supplying your garage with high-quality garage equipment.
We can offer you garage equipment and MOT Bay advice over the phone at 0113 469 0572, we have helped to advise, supply, and set up hundreds of MOT Bays across the UK, and would love to supply your garage with an MOT Bay next.
Disclaimer: Concept G E Ltd acts as an intermediary and only offers nonregulated credit products facilitated by our specially selected finance partners, who are Authorised and Regulated by the Financial Conduct Authority. Concept G E Ltd is unable to provide financial products of any kind or financial advice in its own right.