KME CNC, a maker of five-axis tombstones, trunnions and other workholding, announced today its partnership with U.S. Bank to offer some new financing options for lower-cost equipment purchases. As part of the announcement, KME shares six interesting tips for getting the most out of your equipment financing.
Know Why You’re Buying
Have a thorough understanding of how your equipment acquisition will benefit your business. Project your cost savings or incremental realizable profits.
Know Your Credit History
Understand your business credit and organize your financial information before contacting an equipment financing provider. Be prepared to explain in advance any negative business results such as a business loss in the last year or two.
Research Financial Providers
Make sure to check out your financial services provider thoroughly. Work only with established financial solution providers. Always compare rates, lease terms, fees and options.
Never pay upfront “application” fees to an equipment financing provider.
Decide Whether to Buy or Lease
Talk to your loan consultant about whether it makes more sense to purchase or lease. You may have additional financial benefits including depreciation and interest expense benefits for tax purposes. (Read more about factors that go into this decision in last year’s blog post, “Fourth Quarter: A Time to Buy, a Time to Lease.”)
Consider bundling multiple equipment acquisitions from different vendors under one financial agreement with an independent financing provider. Bundling equipment acquisitions generally results in lower rates, and also minimizes processing fees.
What tips would you add from your own experience acquiring new machine tool equipment?