Thinking about financing to acquire the equipment or technology your business needs? You’re not alone. According to a recent Equipment Leasing and Financing Association (ELFA) study, 78% of businesses used equipment financing. With a 3% growth in investment in equipment and software anticipated through 2017, the need for financing  remains strong.

Whether you’ve financed your business purchases in the past or not, here are three things you should consider when making the decision to finance:

How quickly will you make a return on your investment?

For purchases that take several months or even a year or longer to see a return, financing helps maintain your balance sheet by spreading the cost over time via monthly payments. Some finance companies offer deferred payment options to help defray upfront costs—you could potentially start seeing your return before making a full monthly payment!

How soon will the equipment need to be replaced?

With new equipment and technology upgrades and features coming more rapidly, we see an increase in the speed of obsolescence. If the asset you’re acquiring will need upgrading, financing can help reduce the risk. Rather than paying full price and then having to trade-in or sell when you upgrade, a lease option often allows you to easily upgrade to the newest version without the hassle of selling your old equipment.

Some equipment or other assets have a long useful life and you don’t need to worry about obsolescence. In those cases, using financing may assist in managing your cash flow. Many businesses still choose financing to maintain balances and avoid depleting their cash reserves.

Does the purchase have additional soft costs?

When purchasing many types of equipment or software, businesses are often faced with additional soft costs such as installation, training, shipping, taxes, and more, which can significantly increase the expenses incurred by a business. A lender that offers 100% financing is able to wrap those costs into your finance package to help you avoid a large initial outlay of cash.

As the ELFA study highlights, the decision to use financing versus paying cash is one every business faces when acquiring assets.

If you’re planning to acquire equipment or software, let Ascentium Capital provide a free consultation on payment options that would work best for your business. Contact us today to learn about our fast, flexible financing, leasing and loan programs.