Should you buy a van or lease it?
August 15, 2016 at 2:11 PM
If your business involves having to transport tools or goods, then you are going to need a van. In any business, purchasing a van is a significant investment. For most, this means either buying or leasing one instead. Read the Capels guide to buying and leasing vans:
When it comes to vans, the most popular option is to buy one. This option itself opens up two other options – to purchase a new van or, a used van. Whether you buy a new or used van, you'll have to pay part of its price upfront as this is a business investment. Once you buy it, you are free to make use of it whichever way you think your business would benefit from it, so that you have the best return on investment possible.
Alternatively, you could also consider leasing a van if you think that this would be a better choice for your business. The only difference with leasing is that you are paying a monthly fee to rent a van of your choice without actually owning it. A lease could perhaps limit your possibilities, as for most leasing companies you'd have to pay for small scratches that may have occurred during the transportation period.
Which is the best option?
The main benefit of buying a new or nearly new van is that it is yours, and yours alone. You can manipulate it in such a way that adapts in the best way possible to your business's needs.
For example, labeling your van on the side with your business name on the side of the van is one of the biggest advantages you can get.
Going around for work, while at the same time increasing your brand exposure, is something that you will never be able to do with a leased van. Simultaneously, a van, as it is an asset for your business, it could be monetised in a moment's notice if your business needs cash flow injection.
If you lease a van the main advantage is that there is no substantial upfront cost. Although you may have to pay a deposit, leasing a van means that it is easier to budget for the expense as you pay a set amount each month for as long as the contract holds (normally between two and five years).
Depending on the lease agreement, you may also benefit from the fact that there are no maintenance costs as they are often included in the monthly fee paid for renting the van.
If you are thinking about investing on a van, it is important that you do your homework. Know what are your needs and the purposes that you are going to use your van for.
There is no need to buy a van for example if you are doing a periodic work, and indeed there is no need to hire one if vans are at the very core of your business.
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