Does Cash-flow Control Your Growth?

‘They’ say “Cash is king.” For many small and medium sized businesses access to capital is both the driver, and killer of growth. We need cash to pay for operational expenses like inventory and payroll, logistics and marketing too. But it’s also required for investment in the tools and equipment necessary to grow your customer base. Without sufficient cash, businesses may be forced to shut their doors for good when they would rather be growing their operations and profitability.

By leasing equipment through Yellowhead Equipment Financing you can invest in the equipment you need for that growth – expanding your operational capabilities, without having to spend the money upfront.

Positive Cash Flow is Key

It all comes down to business 101. You need more money coming in than going out over a reasonable period of time. Many businesses operate a healthy cash-flow, but lack the resources to grow. More often than not, growth requires investment. That investment can come as a lump sum, or amortised over time – during which your expansion should be allowing for greater inflows to compensate.

A simple example: Suppose you’ve got $25,000 available in cash on May 1st and $40,000 on June 1st. Congratulations – You’ve got cash flow of $15,000 for the month. Positive cash flow is a great thing – because that flow is what enables you to grow. That incoming cash flow contributes to your business in a number of ways. It provides stability for slow months, and it ensures that you’ve got a positive balance which is important to your financial institutions.

YHEF Can Help!

Equipment costs are regularly greater than just a few months net profits, and you may not want to lose access to that profit that maintains your healthy balances and looks so great to your bank. When you know that growth is critical to your future success, investment in additional equipment can increase your monthly inflow, and with the efficiency of well equipped operations, you’ll also generally earn more. By meeting demand, staying efficient, and investing in your business equipment – you’ve got the keys to maintaining, and building a successful business.

Purchasing equipment outright is a large burden on many businesses. Financing or Leasing protects your cash reserves over time and provides a more flexible way to build up your capabilities immediately – instead of creating what you be could be stressful financial burden to small business owners. Purchasing equipment outright means less money in the bank, sole responsibility for that equipment and a smaller bank balance. That reduction in capital may even put your company at risk of closing its doors for good.

Where does YHEF come in?

Financing and Leasing are business changing tools for cash management. By leasing with YHEF you have the power to:

• Keep your cash to run your business
• Get the equipment you need fast
• Preserve your credit for expansion or unexpected needs
• Own the equipment at the end of the lease
• Benefit from tax advantages of deductible lease payments (subject to CRA)

Most importantly, you will get the equipment you need now, when the opportunity to grow is available to you.

So, start building your business, earning additional profits, and being the business you need to be by applying for a lease today!