| Leasing is a term that can benefit your company | | | | by the customer. Its main advantage is related to |
| when you are undertaking a franchise and have high | | | | taxes, since it allows for accelerated depreciation. |
| costs of property and machinery. It helps alleviate | | | | Operational Leasing. Here, the Equipment Leasing |
| some of those repetitive costs. | | | | Company pays for both the equipment and the |
| Your company signs a contract with an Equipment | | | | additional maintenance and repairing cost. |
| Leasing Company which your company is entitle to the | | | | The third one is called Back Leasing. Here your |
| use of equipment after paying a fee for a specific | | | | company will sell the equipment to an Equipment |
| period of time. When the contract ends, your company | | | | Leasing Company which will later lease it back to you |
| has the option of paying for the equipment, giving it | | | | in exchange of a fee. However in this option, you have |
| back or sign, or signing a new contract. | | | | no tax advantages. |
| Once you've completed the term of the contract with | | | | What are the costs leasing? The costs come from |
| the Equipment Leasing Company, the lessee has the | | | | two sources: depreciation and interest rates. The first |
| option to acquire the asset at a specified price, called | | | | one is the most expensive one, and the last on is the |
| residual because its calculation is given by the | | | | cost of having money availability. |
| difference between the original price paid by the | | | | One way your company can reduce the cost of |
| landlord (plus interest and expenses) and the amounts | | | | leasing is through Granting. This method allows you to |
| paid by the lessee to the Equipment Leasing | | | | make smaller and more attractive monthly payments |
| Company. If the lessee does not exercise the option | | | | for your inventory. You do it by increasing the residual |
| to purchase the property, it should be returned to the | | | | value of a product so much that it is higher than its |
| company unless the contract is extended. | | | | face value. |
| When it comes to leasing, you have three options: | | | | The cost of leasing will be the addition of an interest |
| Financial: it is a contract where the Equipment Leasing | | | | rate plus the depreciation of the equipment, this interest |
| Company purchases the property for the lessee to | | | | rate is very suitable for companies with little capital, |
| use. The maintenance and repair costs are covered | | | | plus the tax advantages your company could have. |