Compound Profit Blog

Everyone knows that equipment leasing offers several important benefits to any company, starting with easier access to funding, financing which also covers the costs associated with installation and maintenance, perpetual access to new technology, tax savings, and so on.

What very few people realize, though, is the fact that equipment leasing comes in different flavors, and that some of the leasing options will work better that others for a particular company. So how do you choose the proper lease for your business?

First of all, make sure that you’ve got a clear, easy to understand lease contract. What are your obligations? What are the leasing company’s obligations? You want to make sure that these obligations are stipulated clearly in the leasing contract.

Then, make sure to compare at least a few offers; you will want to look at the cost per month, possible upgrades / replacements for equipment that becomes obsolete, renewal terms, customer training, etc.

Make sure to check what happens with the maintenance part of the contract; most companies will have a separate contract for it, but you will definitely need to find out what happens if the leased equipment gets damaged. How much time will they need in order to fix or replace it? If you’ve leased a car you can probably use the bus for a few days, but if you’ve leased a critical piece of equipment which prevents the entire production line from doing its job, you will want to have the fastest response time from the service team.

What happens when a new equipment model is released? Will they upgrade the existing equipment right away, or will you have to wait until the old contract expires? These are just some of the important things that must be taken into account when you are considering equipment leasing.

It’s sad, but true: many contracts include hidden fees these days, forcing you to pay for training and other services you might not be aware of. It’s clear that with complex equipments, you will need to get some of your employees trained after all, but make sure that all these costs are detailed in the contract.

Another aspect: don’t assume that the equipment you’re leasing includes everything that’s needed in order to run properly. As an example, if you have leased a PC, it might not include Windows, Microsoft Office, etc, forcing you to buy them separately or to use free software that might not be compatible with the standard applications.

Compound Profit offers honest equipment leasing services with fast approvals – even for startups! Contact us for more information.

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If you plan to open up a new business, you have to be prepared to invest some money into it. And while some of the business ideas can be set up for the initial run using only a few hundred of dollars, most of them will require you to invest tens of thousands of dollars into the needed equipment. Sadly, since most aspiring entrepreneurs don’t have that kind of money at their disposal, this marks the end of their entrepreneurial dreams.

If this sounds like your story, you should definitely consider equipment leasing. Through equipment leasing, you will be able to buy the needed equipment and use it without having to support the upfront costs. In addition to this, you will also void the risks of assuming ownership; this means that if a particular equipment piece loses its value because of the technological advance, you can easily lease a new piece that offers greater productivity, reduces costs or is more environmental friendly, while saving a lot of money. Other benefits arise from having the possibility of overcoming the limits set on your company’s budget and enjoying several tax benefits.

Few people realize that through equipment leasing, they are actually conserving their company’s working capital, thus being able to grow it faster and allow it to be prepared for any unexpected events. Also, since the lease intervals are usually bigger than the ones used for the bank loans, the payment terms offer greater advantages. And one more thing: the leasing terms can be negotiated on a “per case” basis – that’s something you won’t be able to find so easy in the “real” lending world.

Many business owners are already using all these advantages, choosing to get the needed equipment for their companies through equipment leasing. And while most people think that leasing the equipment is an appropriate solution for big companies, the size of the company doesn’t really matter. In fact, small businesses can get a greater return on investment out of equipment leasing most of the time, because this gives them the ability of using modern technology, software, etc that would otherwise be inaccessible, in order to obtain greater and greater profits.

Let’s take a real world example: a self-employed graphic designer who could either lease the latest and greatest version of Adobe Photoshop or work with a much cheaper alternative, which doesn’t have all the needed tools and has trouble importing and / or exporting the various file formats, etc. Another example: a construction company won’t be able to get bigger contracts because it can’t afford to purchase a more expensive piece of equipment, and thus misses the chance to expand its activity.

With equipment leasing, your company can grow naturally, without being limited by its working capital and funds. Contact us and let’s set up an equipment leasing strategy that will accelerate your company’s growth.

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Does Compound Profit’s ProntoLease Financing Option Help Close More Vehicle Wrap Sales?

Just ask Robert Butcher, owner of J&R Graphics. Robert and his wife Julie own a full service commercial signage business in Denver, Colorado.

Robert recently closed a vehicle wrap financing deal for multiple wraps using the ProntoLease financing option for his client.  Robert advises that… "Originally my client was interested in wrapping one vehicle with a cost in the $3,000 range. The client liked the proposed wrap design that we created and presented for his approval and wanted to wrap multiple vehicles in his fleet, but he also wanted to conserve his cash. 

Compound Profit’s ProntoLease financing option was the perfect solution for my client. My client was able to wrap four vehicles in his fleet with full and partial wraps and we uplifted a $3,000 sale to $6,800. Compound Profit pays me 50% of the purchase order upfront and the remainder immediately upon completion and acceptance of the job by my client. My customers need only complete a single one-page application form and fax to Compound Profit along with my written quote. No tax returns, no financials and no collateral are required from my customers. We get a response from Compound Profit’s Processing Department within 24 hours, allowing us to quickly move forward with our customers wrap”.

Robert and his wife Julie are keenly aware of the cash flow challenges of their signage customers due to the recent turmoil in the money systems and find that the ProntoLease financing option is helping them make sales that they would otherwise lose.  Robert advises that customers who would normally be able to pay cash for a job are often finding that banks have severely limited their credit line or capped it altogether.  Banks that were regularly offering working capital micro-loans to their business clients in the past, are now declining such loans.

Robert advises that the key to closing more sales using the ProntoLease solution is to… "Incorporate ProntoLease financing option in every proposal, so that the clients knows that they can preserve their cash and still get the signage that they need to leverage exposure for the business in the local market center".

If your company is located in the Denver area and you are considering a vehicle wrap, commercial signage or a specialty graphic to increase exposure for your business, contact Robert or Julie at 303-478-1773 for a courteous discussion and professional advice.  Visit their web site and click on “VEHCILE WRAPS” for an expert’s overview of why a wrap can improve your business.  Vehicle wraps is just one of eight areas of expertise of JandR Graphics.

Robert Jacobs is an Account Executive with Compound Profit.  Mr. Jacobs helps small to medium size business owners get capital for growth and cash for operating expenses… when the bank has to say no. Visit his web site at http://www.cprofitrj.com  for more information.  He can also be reached at (877) 386-3716, ext 134.  Learn more about Compound Profit’s SMART CAPITAL ADVANCE solution for business owners and for bankers at http://www.smartcapitaladvance.com/jacobs

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As I meet business owners at networking or social events within the Washington DC Metro area and tell them about what we do, the first thing I state is that Compound Profit is an “Alternative Business Financing” solution provider to the small business community. The first question that usually follows is… ”What is Alternative Business Financing?”

So what is Alternative Business Financing? In today’s tight economical times when traditional banking institutions have stopped lending money to small businesses and have slashed lines of credit by 30-50%, the small business owners must look at “Alternative Business Financing” solutions or tools to stabilize and grow their business. That answer makes sense but usually does not make the proverbial “light bulb” go off. So these are examples of Alternative Financing Solutions that are available to the small business owner to help them grow and expand their business:

• Accounts Receivables Financing – Factoring, as it is most commonly referred to, is the practice of selling a company’s customer invoices (B2B invoices) to an authorized 3rd party (otherwise known as the Factor) and they will advance your company up to 90% of the invoice amount, collect the money from your customers, and then refund you the remaining 10% minus their processing fee. Unlike banks or other lending institutions, these companies do not lend based on your credit, but focus mostly on your customers' credit worthiness and / or strength in repayment. This is a great way for businesses to better manage their cash flow, purchase needed inventory, or cover operating expenses. There is no need to wait more than 30 days to be paid by your customers when you could take that capital and generate even more revenue for your business in only a few days. Our Smart Capital Advance program is an example of this type of solution.
• Friends & Family - If a bank is not willing to give you a loan, sometimes friends and family are more than willing to provide you the initial seed money or working capital for your business. Usually, friends and family can be the best source of financing because they know you well, and understand the social consequences of you failing to repay their investment.  However, sometimes it is best to keep business and personal relationships separate; otherwise, you risk to ruin those personal relationships. If you do move forward with getting financing from friends and family, make sure that you get all agreements in writing, even if your family members insist that it isn’t necessary.
• Purchase Order Factoring / Financing – Similar to Accounts Receivables Financing, Purchase Order Financing is the advance of funds to a company, based on the amount of the purchase order, so that the company can fulfill the purchase order. Purchase Order Financing is a solution that enables small businesses to go after and fulfill large orders. When used correctly, this can enable you to grow your company quickly. As opposed to bank financing, purchase order funding does not rely on your business credit profile, but rather on the financial strength of your customers. In other words, if you sell products to large companies or to government entities, purchase order funding can be a great way to finance those sales. To qualify for purchase order financing, your company must sell products. An ideal candidate for this type of financing would be a product reseller or distributor who is buying products from a supplier and then shipping the products to the client. Purchase Order Factoring is one of our core solution offerings as well.
• Angel Investors - Angel investors are private parties, and sometimes businesses, that invest their own funds into selected businesses. The angel investor becomes, in essence, a stockholder in your company, and is as concerned about your business' success as you. Each investor establishes his own guidelines, application methods and standards.  Angel Investors do require a fair amount of documentation (i.e. business plan, sales forecasts, sales and marketing plan) before they will invest any funds. In addition to that, the business owner must be willing to give some equity in the business to the angel investor.
• Merchant Cash Advance - Merchant Cash Advance programs grew from accounts receivable financing solutions. Merchant Cash Advance is a financing solution based upon the merchant’s future credit card sales. Specifically, the lender purchases a portion of the business' future credit card sales at a discount, the rate of which is generally based on the business' sales volume and history. In order to receive a cash advance, a business must be operating for a minimum of three to six months and must process a minimum amount of credit card sales (around $3,000 a month). Many lenders provide a short online application that can be reviewed within 24 hours. After approval, most lenders can send the money within a week. The merchant will receive all the money, while the lender collects a fixed daily percentage of the business' credit card sales until the debt is paid in full. Our Merchant Card program is an offshoot of Merchant Cash Advance programs within the industry.
• Peer-to-Peer Lending - With peer-to-peer (P2P) lending, the financial transaction occurs directly between individuals or "peers" without any involvement of a traditional lending institution. Companies such as Prosper.com monitor an online marketplace where borrowers post their loan requests and are connected with lenders who "bid" on the chance to finance the loan. P2P business loans are usually limited to $25,000, and if you default on your P2P loan payment it can negatively affect your business credit profile.
• Equipment Leasing – Leasing vs. Purchasing is a question that small businesses ask themselves every time they need equipment. Leasing offers many benefits over actually purchasing the equipment. For example, leasing does not require large down payments of cash, which can be put to better use inside the business to pay for current operating expenses. In addition, some leases allow customers to expense 100% of each monthly payment, thus resulting in a real tax benefit to the customer. We offer many types of leases: Small Ticket Leasing, Commercial Leases, and Municipal Leases but this is a discussion for another day.

These are just some examples of alternative financing solutions that are available to small business owners. By using these alternative sources of capital, many business owners will be able to grow their business to a point that they do become creditworthy in the eyes of their financial institutions. Compound Profit is the #1 Brand in Alternative Financing and we have a variety of solutions to help small businesses grow and expand their business.

Anuj Mehta, Regional Director/Principal Advisor

Phone: 877-386-3716 ext. 221

Fax: 877-490-4224

http://www.cprofitdc.com

amehta@cprofit.com

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Many business owners find themselves in a position where they’d want to expand their business, but lack the needed equipment. In fact, many companies lose money each day just because of this. Fortunately, there is a solution to these problems: small ticket leasing.

How does small ticket leasing work? The lender buys the needed equipment, “renting” it to the business owner for a specified number of months. At the end of the contract, the customer can either stop using the equipment, purchase it at a fair price, continue to lease the equipment or lease new equipment, in case that he / she wants that, because (let’s say) the business makes use of modern technology – it’s a simple, cost-effective solution that can keep any company competitive.

What can be leased? Software, computers, trucks... anything! You can even lease soft costs like training, hardware and software installations, and so on.

Who can benefit from small ticket equipment leasing? Any business, at any stage of its development! It’s not a surprise that more than 70% of the companies in the U.S.A. have used leasing, thus getting equipment that totals over 500 billion dollars during the last year.

Small ticket equipment leasing helps vendors as well; by partnering with a small ticket leasing company, they won’t lose sales because their clients lack cash or can’t get credit. This way, the vendors can say “yes” to more clients and close more sales.

If you are interested in getting the needed equipment without using up your line of credit, want to keep your working capital and even benefit from significant tax deductions, small ticket leasing is the perfect solution.

The banks used to offer equipment leasing on a large scale in the past; however, things have changed lately. The banks aren’t prepared to take risks anymore, so they have started to ask for larger and larger down payments, making the things harder and harder for the business owners. Fortunately, there’s hope: the alternative financing companies offer a far greater flexibility:

- much smaller or inexistent down payments;

- fast approvals;

- low monthly rates.

At Compound Profit, small ticket leasing approvals are fast and easy, taking less than 24 hours. We offer small ticket equipment leasing services to businesses, regardless of their size and credit; startups are more than welcome! Want to grow your business faster? We have the money you need right now, no matter if you need $500 or $500,000. Start expanding your business today – contact us to learn more about our flexible equipment leasing options.

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