Why Asset Rentals will work for you.
Who should consider Asset Rentals?
With businesses budgets are constantly being squeezed for better or more ICT equipment. The overall demand to “do more for less” has never been so great. Hence Asset Rentals, protecting precious capital budgets being spent on large projects and IT refreshes. Asset Rentals delivers a predictable, easy-to-budget approach that helps manage assets and preserve cash-flow
By using Asset Rentals, it provides businesses with the means to maximize available funds, leaving existing budget resources untouched to be invested in other essential areas of development. It is also an effective means of achieving better cash management, given that businesses have the ability to spread the cost of repayment over 2 to 5 years, dependent on the type of equipment purchased..
Asset Rental Advantages
Asset rentals is the preferred way of acquiring new ICT equipment.. The low monthly repayments ensure that you have cutting edge equipment at a fixed monthly fee.
Cutting Edge Equipment
The financial implication attached to owning obsolete ICT equipment is high. The replacement of equipment or the loss in productivity has a direct impact on your profitability.
Diversification hedging of financing sources
Large companies require finance for a wide spectrum of assets and projects such as vehicles, buildings, new product development and ranges, to name a few. Asset Rentals facilities offer end users a new source of finance thereby not limiting clients to facilities available from traditional sources.
Off balance sheet financing (OBS)
Rentals are off balance sheet items and does not require Capital expenditure approval and because of OBS It basically reduces debt to achieve a lower and more desirable debt-to-equity ratio.
Convenience to you
Due to its off balance sheet nature, rental requires much less accounting than outright purchases and conventional forms of financing. Asset Rentals allows exact costing to be allocated to different departments with minimum effort. In contrast, purchased or leased assets must be capitalized and depreciated, while finance charges must be calculated on leases, all of which require time and effort.
Conservation of working capital
Asset Rentals offers a low entry level of cost, as no deposits of initial lump-sum payments are required. The use of working capital is therefore reduced.
Asset Rentals agreements, with their flexible structures offer a protection against inflation, when compared with conventional forms of financing. Longer periods, no deposits and annual escalations result in lower entry level costs and allow the user to pay future rentals with inflated Rands.
VAT is payable monthly over the rental period as apposed to a lump-sum payment upfront when purchasing assets, resulting in a cash flow benefit. In addition, rental payments are tax deductible because rental is deemed to be an off balance sheet item.