Why an SME Should Lease Enterprise Mobility Solutions

Why an SME Should Lease Enterprise Mobility Solutions

Why an SME Should Lease Enterprise Mobility Solutions
Confused Yet?

In most cases when companies undertake an Enterprise Mobility project they are looking to improve the productivity of mobile workers who are located away from a traditional desk based IT environment.

They soon realise that to make the deployment a success they need to synchronize a number of key moving parts including app design database hosting training hardware device provision and management. In terms of financing many have realised that the secret sauce is actually the utilisation of the system rather than actually owning it. This has been the case for many years for large companies who have always known the importance of leasing.

 

We talk to many SME’s who are competing with large competitors. They see mobile technology as a way of demonstrating process excellence to their customers. Whilst at the same time enjoying improvements in their own effectiveness and efficiently.

For SME’s undertaking an enterprise mobility project leasing provides them with a way to invest in a high return solution without having to blow up a huge part of their annual IT budget. In many cases the primary reason a project is parked is that whilst an ROI may be compelling an organisation may simply not have the free cash to make a one off purchase in an area they may not be familiar with. Adding another vehicle or employee can often seem a simpler option.

What Sort of Lease?

There are various type of lease but the most common in this scenario is an Operating Lease. In this scenario the customer only buys the right to the property for a specific period of time. At the end they can return the property or pay a nominal sum to acquire title.

The changing pace of technology along with inevitable revision of operating practices has led many to use an operating lease as a way to bundle all the elements into a single off balance sheet transaction that is treated as an expense not company capital. This can dovetail very well with the 24-36 month technology horizon that has become the norm in the minds of many buyers.

8 Leasing Advantages for an SME

  1. Gives the SME position power of a cash buyer.
  2. Allows for the payment of a capital purchase with low monthly rentals – budget and manage cash flow.
  3. Manage obsolescence with technology upgrades – without writing off large single sums.
  4. Invest money in other areas – more return on capital.
  5. Bridge the gap between what you need and what you can afford.
  6. Fully allowable against taxable income.
  7. Spread costs and save on tax. Payments are treated as operating expense so are tax deductible.
  8. Flexible.

At the end of an operating lease the client can

  • Add further capability to the system refresh and re-new.
  • Send the assets back.

Excellent ROI

It is not uncommon for an Enterprise Mobility project to have  a positive financial impact on a business function within 9 to 12 months. It is our firm belief that after the 36 months of a typical lease the solution will have proven it’s worth beyond the value of the rentals paid.

Why an SME Should Lease Enterprise Mobility Solutions

To Lease or not to Lease that is the Question

To Lease or not to Lease that is the Question

Guest Blog from Kirsty Rostron our resident leasing guru.

To Lease or not to Lease that is the QuestionBusiness moves fast especially if you are a organisation looking at mobile technology to solve business problems. So when it comes to acquiring equipment of any size shape or form that will enable your organisation to grow and become more profitable there is little time to ponder over critical decisions.

None more so than those of a financial nature, which if made on a whim – or based on the premise that it’s the way things have always been done in the past – could end up having an adverse affect on the business in both the short and long term.

With many businesses looking to convert Capital Expenditure (CAPEX) to Operational Expenditure (OPEX), there is most certainly more of a noticeable trend for these financially astute and progressive organisations to move away from the total and outright purchase of ever changing technology. Rather electing to acquire them via a lease agreement instead.

So why choose to go down this road? Other than the obvious one of keeping expenditure off the bottom line and more money in the bank for those unforeseen rainy days leasing has so many other benefits. All of which you simply can’t afford to ignore. Especially when there is a growing awareness among senior managers that since putting leasing to the test and experiencing the benefits first hand, they would never consider returning to what they did before.

So what exactly are the benefits of leasing?

Leasing delivers a great many financial benefits and the effects are long-term and secure. This helps to provide you and others in the organisation with a more favorable experience when using the newly acquired product. The other benefits may not seem as obvious at first as the financial ones but are no less important and impactful when you consider them in more detail. These are just a handful:

  1. Choosing to lease means that you get your product straight away rather than when budgets allow. Enabling everyone to start using that much needed device or solution as soon as possible.
  2. By leasing you are placed into a fixed agreement which remains secure throughout the lease period. You won’t have to worry about changes and unpredictability as the lease option is uncomplicated and safe. This allows you take more calculated risks in other areas of your business.
  3. Leasing offers you the flexibility to be able to upgrade your enterprise mobility technology at any stage throughout the agreement by simply restructuring the payment schedule. Allowing you to react to rapidly changing market dynamics and steal the march on competitors.
  4. Leasing is extremely cost efficient. You can offset 100% of the rentals against your tax liability to maximise tax efficiency. Learn More.
  5. Leasing benefits the future of your business. Cash purchase only secures the fact that you have the product you need, but it doesn’t offer you the long-term benefits that leasing does. Leasing equipment releases valuable working capital for alternative projects within your business.

Key Point: To Lease or not to Lease that is the Question ? Over £30 billion of Capital equipment was financed in 2016 in the UK alone and it’s estimated that around 90% of The Times Top 100 companies use leasing as a means to acquire equipment and business solutions, so they must be onto a good thing. In fact now that you know a lot more about the benefits, it begs the question. What’s stopping you from experiencing the power of leasing?

For more information and to get approved for your lease Contact Kirsty via the link below.

To Lease or not to Lease that is the Question

 

Talk to us about how we can help you arrange finance to incorporate all the key elements of your enterprise mobility system including enterprise grade devices deployment and ongoing support.

 

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