Growth is the cornerstone of any business, no matter how large or small. If you don’t constantly grow you may find yourself out of business because you were simply unable to keep up and compete with business rivals.

Expansion is expensive.

Expansion is expensive and always carries a certain amount of risk. Whether you are opening up a new branch office, bringing more employees on board, or just making sure your computer systems are up to date, you are going to be incurring major expenses. What can make this even more daunting is that many newer small businesses operate on very low profit margins. Beyond that even if your expansion is a success it may take months or years before you start seeing a solid return on your investment. Then, once the money starts coming in again it may be time to expand once more.

What’s a small business owner to do?

Stop, take a deep breath and consider all of your options.

You could decide to pay for your expansion out of your working capital. After all, you have earned the money, so why not reinvest in your company? This is common mistake that can put your company at risk of financial ruin. What if your business sector suddenly takes a strong downturn and you are left with no spare cash to endure such a business cycle? What if your expansion goes sour and you are left without capital reserves to pay your employees for projects that are generating revenue. Do you really want to risk having to sell barely used equipment at a loss a year or two from now?

Leasing lowers your tax bill

In addition to the capital expenses associated with purchasing, once you have bought the equipment your new assets become a tax burden. That means that in addition to your expansion expenses, you now have to pay a higher tax bill. Leasing lowers your tax bill because you have increased your monthly liabilities without racking up new taxable assets.
Leasing equipment also has no effect on your personal credit rating whatsoever

Of course, you could decide to take out a small business loan to fund your expansion efforts. That’s what your banker will tell you to do. This method has all the pitfalls of purchasing the equipment outright with the additional liability of increasing your personal debt load which of course will weaken your credit score.

(On that note, as an aside you should note that in addition to leasing, GCR Capital also provides many types of commercial financing options regardless of your credit score.)

When you lease, you keep all of your capital in the bank for a rainy day. All you make are small monthly payments. At the end of the lease cycle you have many options—you can chose to purchase the equipment or return it and upgrade again without having to get rid of any outdated inventory.

Please take a moment and consider all the advantages leasing with GCR has to offer:

1. The ability to expand your business with minimal monthly expenses.
2. The opportunity to preserve capital in your accounts for the future.
3. The option to purchase, upgrade or expand again when your lease expires.
4. Lower tax obligations.
5. No future inventory hassles
6. The preservation of your personal credit rating.
7. The opportunity to make sure your business remains competitive.

These are among the many reasons why leasing is the most sensible option for most small business owners. Why not take 60 seconds to fill out a leasing application and find out exactly how GCR can help your business keep pace with the modern business world?