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Financing & Leasing A Courier Vehicle - What Are The Differences?

When starting a courier business, you will draw up a business plan and find financing sources for what you want to buy. One of those things to finance is a vehicle to help you in delivering packages for customers. Do you lease out or buy a new one? How will it affect your business when you decide to lease or buy? Do you have enough capital to buy? The differences between financing and leasing a courier vehicle can be explained as below:

Reputation Of Your Business

You may need to have a new vehicle now and then for the purpose of selling the image of your courier businesses. When a new model of a vehicle comes out, you want it to be part of your fleet. If this is the case, you cannot afford to buy a new model every time it comes out. The option is leasing which is less costly as with buying a new one. Most customers will want a company that offers different tastes according to their preferences. Couriers that use old or out-dated vehicles, to deliver packages to their customers Are less likely to attract new customers as compared to those who lease out new models.

Potential Of Your Business To Grow

Competition is high among courier businesses in the UK. With such a competitive spirit, you cannot afford to tie up your capital by buying a vehicle. Financing a courier vehicle means that you will tie up your capital and thus the potential of your business to grow will be minimal. An alternative is to lease as the cost is low when you compare to buying a new one. The idea is to give your business the needed capital to stay in the competition and thrive. However, large businesses with huge capital to spend can opt to buy new vehicles for their courier businesses.

Size Of Your Courier Business

If you have a large size courier business, then you can afford to buy a fleet of courier vehicles for your business. This is where you go for the financing option. Such couriers will have multiple vehicles and also they offer leasing services to smaller couriers who cannot afford to purchase them. Leasing is thus left for small businesses as buying will not be economical on their part. This is due to the low revenue the small business gets, which does not translate to owning a courier vehicle and thus opt to lease.

Liability Of Maintenance On The Vehicle

When you finance a vehicle, you assume ownership and this means that you have to take up the liability of the cost that comes with repairs and maintenance. Assuming that you are a small courier business, this can take out a lot of your capital and profits.

On the other hand, leasing a courier vehicle means that you do not have to deal with the costs of repairs and maintenance all you do is pay for the lease charges as the owner while you transfer the costs of maintenance and repair to the owner. This will free up your resources, that is, capital so that you can invest it in your business to increase production.


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