Your equipment works for you
A truck doesn't make money sitting in the yard. An excavator doesn't generate income parked up. And a tractor only earns its keep when it's working.
Insights with Infinance by Brian Coogan
For New Zealand businesses, the right vehicle and equipment finance structure can be just as important as choosing the right asset.
Whether you're buying a new truck, replacing a fleet vehicle, upgrading machinery or adding equipment to grow the business, finance can be structured around the way the asset actually works — and the way your business gets paid.
It doesn't always have to mean starting from scratch.
If you already own vehicles or heavy equipment with substantial equity, equity release may allow you to unlock some of that value while keeping the asset working.
The released funds could be used for working capital, repairs, expansion, deposits on additional equipment or simply to strengthen cashflow.
Existing finance can also potentially be refinanced or restructured. Rather than carrying repayments that put unnecessary pressure on monthly cashflow, the finance term may be extended to better reflect the asset's useful working life.
For some businesses, that could mean spreading repayments over up to seven years, where appropriate, rather than forcing a productive asset to effectively pay for itself in a much shorter period.
And then there's seasonality.
Farmers, contractors, transport operators, earthmovers and other businesses don't necessarily receive the same income every month.
Seasonal repayment structures can potentially allow repayments to be matched more closely with periods when cashflow is stronger.
The goal isn't simply to borrow more.
It's about getting the right amount, the right structure and the right repayment profile for the asset and the business.
Your equipment is working for your business. Your finance should work with it.
For more on the above, go to www.infinance.co.nz/insights
Written by Brian Coogan, Licensed Financial Adviser and Director at Infinance- Taupo