Another Alternative Cash Source - Equipment Leasing

Yesterday I wrote about finding cash by selling your accounts receivable or invoices to a factoring company. Another source of funds might be leasing. According to a report issued by the Equipment and Leasing Finance Association, more and more businesses are considering leasing as an alternative to bank financing. In 2006, U.S. businesses leased almost $600 billion in capital goods and equipment. And the leasing industry continues to grow.

Wirth Business Credit is one such leasing/financing company. Wirth is just one of many who provide leasing and financing to small businesses. Wirth works with small companies who need equipment, up to $250,000. For most loans a one-page application form is all that's needed. Wirth operates through franchisees; they currently have 58 franchisees in the U.S. and growing. Wirth Business Credit franchisee Kevin O'Connor says

“Leasing can help small business owners to acquire the latest business-critical tools and technology with minimal upfront cash, which is key for small business owners who usually do not have an abundance of cash on hand. It also enables them to manage cash flow and preserve cash and credit lines for growth rather than tying up cash into fixed assets, and it offers tax write-off opportunities that bank loans do not...."

These financing sources have been around for some time, but they are now starting to be considered more carefully, with the drop in available credit from traditional bank loans. If you are struggling to find financing for business start-up or expansion, consider leasing. Tomorrow, I will review the tax benefits of leasing and the advantages of leasing before hte end of this year.