Industrial businesses, no matter their production system or the market they serve, all face the same problem. The equipment needed to process and produce goods are not cheap, which makes it very difficult for new businesses to get the machinery needed to expand operational capabilities.
So how can businesses get around a problem that rarely reflects on potential, but rather on short-term cash flow problems? Equipment financing.
Your business shouldn't be held back from its full potential tomorrow because of cashflow issues today.
How the unique financial issues in the industrial sector hamstring businesses
Picture the scene – your industrial business is going through a quiet period, and you know it's because your competitors have recently invested in a new piece of plant. However, you lack the immediate cash to purchase this equipment. Catch-22.
Your business shouldn't have to suffer or be held back from reaching its full potential tomorrow just because of short-term issues today. However, many Australian businesses unfortunately do see this as major roadblock, and try to cut corners in their production.
The dangers of using equipment that's not up to scratch
If you know your production system could benefit from a new piece of equipment, or you have machinery at the end of its lifespan, you should replace them. There are dangers of not doing so, such as:
- Inefficient production – old or outdated equipment can contribute to system downtime, which leads to inefficient or even reduced levels of production.
- Damaged products – plant that is no longer optimised for your wider production can contribute to damaged or faulty goods. This can lead to customer dissatisfaction and breaches of safety and quality compliance.
- Compromised worker safety – machinery no longer fit for purpose can even pose a health hazard to your workers during production.
So why is equipment financing the best option for securing the plant you need?
Why is equipment financing the best way to expand your operations' capabilities?
Asset Finance International & White Clarke Group research shows now is a good time for equipment financing, with the sector posting eight years of consecutive growth in the US.
Growth has been strong in the Australian market too. Private capital expenditure on equipment, plant and machinery rose to more than AU$13.6 million in the March 2018 financial quarter, according to the Australian Bureau of Statistics. This shows the continued faith in equipment financing as a means for industrial businesses to get the plant needed for operational efficiency within their means.
Investing in new equipment with this financing method also means cashflow – often a short-term problem for smaller businesses in the industrial sector – is no longer a hindrance to taking advantage of opportunities to expand your operations or diversify what your business can offer customers.
Why choose equipment financing with SRO Technology?
When it comes to equipment lease options, the SRO Technology team will dedicate the time, knowledge and resources needed to ensure you get the right equipment for your production system, repayable in stable timeframe.
The equipment financing options we specialise in are finance leases, in which individuals can rent one or several assets from us for a contracted period of time. This option is ideal for temporary production projects.
Our other option for purchasing new machinery is commercial hire purchase agreements, which allow customers to pay in periodic instalments until they can claim ownership.
On top of our equipment financing services, SRO Technology also offers ongoing maintenance, calibration and repair options for all plant, as well as side audit and design services to guarantee your facility has everything it needs. For more information about anything we offer, speak to one of our friendly service experts today.