Every company aspires to have the best of state-of-the-art technology to be able to provide quality products and services to its customers. However, investing in new equipment for technology upgradation at regular intervals is difficult, especially for small businesses, owing to large capital requirements at all times. This is where equipment financing provides a solution. By financing your required equipment, you can stay updated with the latest technology, improve productivity, while effectively cutting down your upfront cost on buying new machinery.
For companies in the plastic manufacturing business, extrusion is an important process where raw plastic is melted to be formed into a continuous profile. Plastic companies use extrusion machines to produce pellets, sheets, as well as window materials, vinyl sidings, PVC pipes, and various plastic composites. In order to be able to achieve excellence and efficiency in the process — and meet their production goals — companies require top quality extruders. However, these machines are quite expensive and can be difficult to afford — even for companies that have cash reserves. The solution? Extrusion equipment leases or loans!
By getting extrusion equipment on lease, plastic companies can increase their ability to afford and meet their equipment needs without having to dig deep into their pockets. It allows you to save your working capital, which can be utilized towards meeting day-to-day business expenses, business expansions, or unexpected business-related expenses. Also, you are able to scale up your business capacity with the utmost confidence as you don’t have to spend the entire amount on the equipment for the upgrade. You can enjoy tax benefits as equipment leasing payments are, in most cases, 100% tax-deductible. In addition to that, if you are not planning to use the machine for a long time, leasing is a better alternative than buying the equipment and later trying to resell it when you no longer need it.
Equipment Loan Benefits
If leasing is not your best option, extrusion equipment loans are also available to help you meet your production objectives. Equipment loans have their own advantages over purchasing or leasing an extruder. The machine can be shown as an asset and depreciated. Also, Section 179 of the IRS Tax Code allows you to immediately deduct the full cost of the equipment against your taxes (up to $500,000). However, the payments in a loan are usually higher than lease and aren’t fully tax-deductible.
Need help with equipment financing solutions? Get in touch with the Equipment Finance Group today!