When it comes to maintaining business success, it is often the smaller details that have the most significant impact. There are a multitude of costs and considerations associated with business ownership, and each of these need to be treated with the reverence that they deserve.
Fleet management represents one of the most understated aspects of business, as it accounts for a significant investment and average annual cost. By choosing the most efficient and cost effective fleet management solution, you can empower your business to grow and achieve its full potential.
The Fundamental Principles of Fleet Management: Determining its Viability for your Business
In automotive terms, business leasing represents a method of financing and managing a fleet of vehicles. These vehicles are to be used primarily for commercial purposes, and the process of business leasing carries numerous costs, taxation requirements and other borrowings.
It is important to consider business leasing in line with your company’s financial circumstances, in order to determine whether it is a viable solution.
The Nature and Purpose of your Business
This is arguably the most important consideration, as the nature of your business will determine the size and scope of your vehicle fleet. If you employ a number of sales operatives who are constantly out on the road, for example, business leasing provides an affordable way to operate a body of vehicles. Conversely, your business may employ a small number of staff who are primarily office based, which means that ad-hoc car rental arrangements may be more cost effective.
Financing and Tax Re-Imbursements
Business leasing has a relatively beneficial tax and financing structure, which offers various benefits to certain types of business. Not only are leasing repayments tax-deductible expenses that can reduce your annual financial burden, but VAT registered firms may also be eligible to reclaim a percentage of their tax if their vehicles are used solely for business purposes.
A further 50% on the finance element may also be reclaimed if the cars are used privately, so there are significant savings to be accessed under set circumstances.
Monthly Budget and Investment Philosophy
Regardless of how much money can be saved, however, it is important to remember that business leasing requires a commitment to make monthly repayments. With this in mind, it is your duty as a business owner to ensure that you can manage these payments comfortably, so that they do not compromise and existing budget or turnover.
If you feel that business leasing repayments may compromise your firms finances or are looking to adopt a risk averse investment philosophy, you may need to seek out a more suitable solution.
Is Business Leasing the Ideal Option for you?
Once you have made these considerations, you should have a clearer understanding of business leasing and whether it is suitable for your firm. In order to make a final decision, however, it may be worth visiting www.hitachicapitalvehiclesolutions.co.uk in order to acquire an expert insight.