You may approach an equipment financing deal with nary a thought for working capital, but that may be a mistake.
In this business we call the addition of working capital to an existing equipment financing deal “bolting on,” and it’s an apt description. An increasing number of companies find value in pairing the two when they go out for anything from a backhoe to a piece of office equipment.
The reasons for that are simple enough. If you obtain a backhoe using funds from a company—say Direct Capital, because I like having a job—you have to think of what’s required to use that backhoe. Do you need to hire an operator? Do you need money to get it running or to set aside for its maintenance? Do you need money for marketing to let your customers know you can now perform jobs you couldn’t before?
All of those issues can be helped with working capital*, so it makes sense for your business to explore it if you’re already entering into an equipment finance deal. If it can help you to improve the revenue generation on your new piece of equipment, it’s entirely worth it.
Have you bolted-on capital to a financing deal? Tell us about it!
Photo credit to svilen001 at http://www.sxc.hu/photo/1158790
*Working capital not available in the following states: AK, DE, ND, VT