Financing for the purchase of a Vertical Storage System?
When purchasing a Vertical Storage System such as Vertical Lift Modules or Vertical Carousels, it is almost always possible to finance the purchase through leasing. The question you might be asking yourself is: How does leasing work, and why would you choose this option?
The Vertical Storage Systems as collateral
Leasing of a Vertical Storage System is made possible by the fact that there are finance companies that recognize the value of various types of industrial machinery and therefore accept them as collateral.
What the finance company does, in other words, is act as a lessor between the supplier of the Vertical Storage System (e.g., Relevator) and you, the buyer—which allows you to purchase the equipment through monthly payments while you’re using it. This way, you end up with a lower, fixed monthly cost rather than a large lump sum right at the time of purchase. The finance company, in turn, earns a small margin in the form of interest.
Why provide funding?
The reasons why companies choose to finance the purchase of various assets can vary widely, but below we list a few reasons that may help guide your decision to purchase a Vertical Storage System.
Good for cash flow
As mentioned above, leasing a Vertical Storage System means you can have a fixed monthly cost while using the machine, rather than having to pay a large lump sum at the time of purchase. The impact on your cash flow when financing a purchase versus a cash purchase is illustrated in the table below—and the fact that payments are spread over several years is also reasonable, given that a storage machine is expected to have a long service life. Financing for storage machines is typically arranged over 36–60 months; at the end of the lease term, ownership of the storage machine may transfer to you as the buyer upon payment of the equipment’s residual value.
Easy to budget and manage
By financing your purchase, you’ll get a very clear picture of what the monthly and annual costs will be for using your Vertical Storage System. The terms are fixed, which means the monthly cost remains the same throughout the entire lease term.
No impact on the balance sheet
Since you don’t own the Vertical Storage System, you don’t need to worry about depreciation; likewise, the leasing cost is 100% tax-deductible as working capital.
If you’re considering Vertical Storage Systems and wondering about your financing options, feel free to reach out to us. We work closely with financing partners and can provide a detailed leasing offer with specific costs and terms. Get in touch using the contact form below or give us a call! Click the link below to see our Vertical Carousel and Vertical Lift Modules For sale.
