Purchasing construction hoists and mast climbing work platforms
Being a Hydro Mobile owner can make your business more profitable!
Cash purchase with funds provided from working capital is normally the lowest cost method of acquiring needed equipment when funds are available. Service fees, finance charges and interest expenses are eliminated for the buyer. Customer ownership is immediate, and equipment cost is shown on the balance sheet subject to the depreciation methods used by the customer.
Although outright purchase may provide the lowest total cost, other factors should also be considered:
- Working capital (cash) which could be used elsewhere is reduced;
- Outright purchase converts a liquid asset (cash) into a fixed asset (equipment), thereby weakening the customer's "current" ratio. Accordingly, most companies prefer to use available credit lines or time purchase plans if ownership is intended.
- Financing offers the same general advantages as leasing or rental plans: limited cash outlay. However, financing provides the depreciation and tax benefits of a cash purchase (ownership).