What is Asset Finance?

21 February 2024

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asset finance aerial view of trucks

How Can You Use It For Your Business?

Acquiring assets is often necessary for some businesses whether it be updating the company’s vehicle fleet, acquiring specialised machinery, or investing in office fit-outs to create an effective work environment. Asset finance offers businesses the flexibility to spread the cost of acquiring these assets over time.

What is Asset Finance?

Asset finance can be used as a financial tool to manage cash flow and empower businesses to acquire essential assets and grow their company without the need for upfront payments or access to extra cash flow. Several businesses prefer this approach so they can avoid disrupting their cash flow. Many businesses have stagnant growth because they lack the capital to make the initial purchases of necessary goods upfront, this is where asset finance is valuable.

Why use Asset Finance for your business?

Asset Finance plays a pivotal role in enabling enterprises to invest in necessary equipment, vehicles, or fit-outs, thereby supporting growth and operational efficiency. Asset finance cab be tailored to meet the diverse needs of businesses, particularly when it comes to acquiring high-value assets such as cars, machinery, or fit-outs. This not only preserves valuable working capital but also ensures that companies can keep pace with technological advancements and industry standards without a significant financial strain. Asset finance can be used for yellowgoods, car fleets, trucks, heavy commercial vehicles, shop/office fit-outs, incinerators etc. Some examples of business goods funded by asset finance include:

Vehicle Finance

We often see clients purchase cars via asset finance for commercial use. Whether it’s for deliveries, client meetings, or routine business travel, a dependable and effective fleet of cars is essential to the operations of many businesses. Businesses can purchase the vehicles required quickly using asset finance without needing to outlay the full cost of the vehicle at the time of purchase. This can be achieved through various financial products such as hire purchase or leasing. In a hire purchase arrangement, the business can effectively pay for the vehicles in instalments over an agreed-upon period, eventually gaining ownership at the end of the term.

Machinery Finance

As an essential component of many sectors, plant and machinery can often be expensive and drain capital resources or be a burden on cash flow. Businesses can grow beyond this financial obstacle with the help of asset finance. Asset finance solutions can be chosen by firms to finance equipment, whether it be manufacturing machinery, construction machinery, or specialised tools that meet their operational and cash flow requirements. This guarantees that businesses use quality equipment that meets both industry standards and efficiency requirements.

Office or Company Fit-Outs

Asset financing works well for furnishing retail and commercial spaces especially if your business is in need of an upgrade or a new professional space. Companies can use asset finance to spread the costs over time rather than dedicating a large amount of capital to these projects. This allows the company’s cashflow to remain stable, while enabling the construction of contemporary, useful offices and workspaces.

Overall, asset finance gives companies a strategic financial tool to replace, update, or buy important assets. Businesses can ensure that growth plans are not impeded by financial restrictions by aligning their asset acquisitions with their cash flow through flexible repayment periods and structuring options. This helps businesses remain flexible and competitive in a constantly changing market. The Brokerage provides smart asset financing solutions that allow your business to secure the equipment and other assets it needs to grow. For other financing options visit our commercial finance page.