Posts Tagged ‘vehicle leasing’

Many businesses follow a traditional path, buying their vans and cars from local automobile dealers. Local garages and businesses are often favoured because they are in the right place to provide timely servicing and maintenance. Most businesses will be able to negotiate significant discounts due to the volume of vehicles they require and the ongoing maintenance and servicing.

The current recession is prompting many businesses to look at alternative ways that they can provide and finance their transport needs.

Business accountants want to cut transportation costs, but this must be achieved without risking profitability. Company cars is one area that many businesses are cutting back. Instead of providing their executives and sales people with their own dedicated company car, bought from the local dealer, many are turning to business car leasing arrangements. Car pools are becoming common place as businesses cut back on the provision of company cars.

It has been estimated that the leasing approach is saving businesses between 20 and 60% when compared to their previous transport costs.

The leasing approach has been taken by many companies who rely on their commercial vehicles and vans. Leasing vans and trucks is not new to business but was previously primarily used by larger organizations. Today’s challenging economic downturn has resulted in many small and medium sized enterprise choosing to lease their vans, refrigerated trucks and minibuses rather than buy.

Businesses can take advantage of the many advantages that leasing can provide. The initial outlay is minimal, there are some useful tax advantages and the fixed, regular monthly payments can help with budgets.

One of the main disadvantages is that the business never actually owns the vehicles which remain the property of the vehicle leasing company. A potentially significant disadvantage is the requirement to stipulate the anticipated annual mileage when the contract is agreed.

If you are a business, of any size, you would do well to research how much you could potentially save and the advantages that vehicle leasing could bring to your business.