Should I lease or buy equipment?

Deciding between leasing and buying often comes down to liquidity (how easily accessible cash is for your business). Maintaining enough liquidity is what carries your business through tough times and emergencies. When it comes time to add equipment to your business, you’ll want to evaluate your liquidity and how your buying decision will impact it.

Generally, buying equipment with cash will eat up your liquidity, leaving you at risk. However, if your business has an abundance of cash or the equipment you’re looking at is under $3,000, buying would be a good move.

For higher-priced equipment and businesses looking to preserve the all-important liquidity factor, leasing or financing is often the best option. By breaking down the cost into manageable monthly payments, you preserve your cash while still getting the equipment your business needs to grow.

—Beacon Funding