Taking the BS out of equipment finance

Having spent 30 years financing equipment for a diverse range of long term and new clients in many capital intensive industries, I thought it would assist to take the BS out of some of the stories I have heard over the years. Interest rates If you are a solid company with good trading results, the interest rates available at present range from 4.5% to 5.25% depending on the asset and term. If you are paying more than this then it may be a case of what your provider would LIKE … [Read more…]

Home Loans: are you getting your bank’s best?

As your home loan is one of the largest debts you will ever have and will have for years to come, 5 minutes invested to reduce these costs can potentially save a small fortune. The 3 easy steps are simple and well worth the few minutes required to ensure you secure the best rates in market. Step 1  Go online and look what your current bank is offering for new home loans to see if those rates are lower than what you are paying. Step 2  If your home loan … [Read more…]

Keys to the Kingdom

Iseekplant doing a cameo on Finlease and putting some humour into the very dry subject of Equipment Finance 🙂 To find out more about our equipment finance or to use our online equipment finance calculator click here

The 5 Things to check off before End of Financial Year

If your annual turnover is under $10 million: 1) Any individual asset under $20,000 + GST purchased before June 30 is an immediate write off (whether financed or purchased outright). 2) A range of expenses can be prepaid for up to 12 months and expensed in the 2017 year and in doing so reduces this year’s profit and next year’s expenses (including tax). 3) If you elect to change your depreciation schedule to the Simplified Depreciation System you can increase your Depreciation on all equipment to 15% in 2018 and 30% … [Read more…]

Including a Finance Option in your quotes to increase sales and margins

Let me start off by saying that most clients will ultimately finance the equipment they buy. Understanding this presents an excellent opportunity for suppliers to offer finance as a function of their sales process. In doing this, suppliers can reap significant rewards both in increased sales as well as margins on those sales. To explain this in more detail the following is relevant Increased sales. This formula is relevant whether the asset is $5,000, $50,000 for $500,000. For the sake of the exercise we will focus on a $50,000 asset. … [Read more…]

It’s the leftover not the turnover that is most important

If a new customer paid you $8000 in return for one hour of your time, would you be willing to do that work? There would be very few people who would say no. Similarly, if you could save $8000 in expenses for the same one hour of your time, would you be just as keen to do that? $8,000 is the saving on a $300,000 truck if you manage to obtain finance at an interest rate which was 1% less than you were initially offered. Unlike home loans, Truck and Equipment Finance … [Read more…]

Finance – It’s more about the relationship

As any business owner in a capital intensive industry would know, finance plays a significant role in their business. It is also true that finance needs to be competitive as it is a significant cost and a 1% saving in the interest cost on the finance of a $500,000 asset will save around $10,000 on a five year term & these savings can be obtained where business owners engage with the right finance provider. Once this is achieved, then it is all about relationship. Business owners have their lives made … [Read more…]

How To Calculate The Cost Of Delaying An ERP Implementation

It’s time to implement – disruptions, risks, conflicting priorities aside, how do you calculate the cost of delaying an ERP implementation? And ensure that the ERP project is back on the priority list? While there are several ways to calculate the cost of delay, a simple calculation that you can use is to apply projected improvements to your own financials such as; Revenue improvements of 2% – 10% Gross Margin 1% – 5%* For example, with a revenue of $100M you have the Annual Improvement Opportunity of between $2M and … [Read more…]

Prepay and pooling offset

Having recently written an article about the very significant increases in depreciation (up to 30% under the simplified tax system) now available to larger companies with an annual turnover of up to $10 million, there are two additional aspects which provide further benefits. At the risk of sounding like Tim from a Demtel commercial “but wait there’s more”, there actually is! Depreciation offset rules Under the pooling provisions within the simplified depreciation system ALL assets sit in this pool. If an asset which has been depreciated to say $100,000 (as … [Read more…]

Accelerated Depreciation, the gift for companies with a turnover of up to $10million

Although much publicity after the 2016 & 2017 budgets surrounded the ability for larger businesses to claim 100% depreciation on assets purchased of less than $20,000 through the reclassification of small business to incorporate companies with a turnover of up to $10million, this is “small change” compared to what has now become available to those companies under the Simplified Depreciation Rules. See link: Simpler depreciation for small business Under the Simplified Depreciation Rules, company owners can actively elect to place all of their assets in a pool for depreciation purposes … [Read more…]