How To Know Whether To buy Or Lease A Truck For Your Business?

The transportation industry is one of the most powerful in the United States. As of 2019, ground transportation was worth $791.7 billion, according to numbers from Statista. This figure is commensurate with the effort and dedication it takes to build successful entrepreneurship in this sector.

A business specializing in ground transportation needs a large fleet of vehicles with different characteristics and capacities to make it profitable. The problem is that the cost of acquiring units is high and requires analysis to choose the type of trucks needed, depending on the merchandise to be transported.

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To obtain this type of assets, there are two alternatives: to buy the vehicles or lease them, in either case, you will require an investment, getting small business financing from companies like Camino Financial is an excellent alternative to form a fleet, even if at the moment you do not have the required capital, making this decision should not be made lightly, consider the advantages that we present in the following to choose whether it is more convenient to buy or lease, according to your needs.

To buy or to lease… that’s the question

The Leasing Advantages

Diversified offer:

Without having to make a large investment, you will be able to offer a new service within your company. This way, if you already have vans, tour buses, or cargo vehicles, but your customers need trucks, they will not have to go to another supplier.

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Monthly payments are affordable:

Monthly payments when leasing a truck will be less than what you would have to pay each month when buying. Your profit percentage will be higher from the beginning. Making the first payments can be complicated, if you need someone to have your back, you can access an affordable loan to get the money you need.

There are no depreciation or maintenance costs:

Since you are not the owner of the asset, you will not have to cover regular maintenance costs such as repairs, oil changes, or alignments, the responsibility is that of the dealership. Moreover, as time goes by, any vehicle loses its value, this issue will not be a concern for your company.

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Some leasing companies do not ask for a down payment:

Depending on the type of institution you lease the vehicle from, the characteristics of the contract may vary. Some companies do not ask for any upfront payment, which will allow you to reduce the amount of your investment. In case the company you choose does require it, you can resort to small business financing to obtain the necessary capital.

The Buying Advantages

The monthly payment is paid for acquiring an asset, not for renting it:

Although this may seem obvious, it is necessary to mention that when you buy a truck in deferred payments, you have to make a monthly payment just like when you rent it. The big difference is that this installment is for an asset that will eventually become yours and will be part of your company’s patrimony.

When you finish paying for the truck, your earnings will double instantly.

At the end of the term of the payments to acquire the truck, your earnings will automatically increase, since the money you had assigned to pay the monthly payment will now remain in the company’s cash box. An option when buying a good is to pursue private business loans such as with companies like Camino Financial and use the money they lend you to pay your truck in cash and control your loan with lower interest rates than with other financial institutions.

In the transportation industry, it is necessary to have the necessary assets to provide the best service to all customers. Whether through purchases or leasing, getting a larger fleet will be the way to grow the business you have established with so much effort. The secret of success in this sector is not to sell merchandise transportation, it is to generate logistics solutions for the companies that trust you.

Analyze in-depth the financial possibilities of your business to know which of the two options best suits your needs. The key when accessing financing is to correctly choose the best product. An alternative for you to better manage your credit is to get it from Camino Financial, where you will find small business financing tailored to your needs. Could you share with us what your business needs to reach its full potential?