Digitization? Super efficient IT processes and modern technology?
These terms get on the nerves of many entrepreneurs. In fact, however, success depends precisely on this. But to keep hardware, servers or software up to date, you would have to retread your technology every two to three years. This costs money and, above all, a lot of time. Money that you can better invest in other areas. Time that is left over for the core business.
What is IT leasing?
When it comes to purchasing new IT equipment, entrepreneurs and their IT departments usually only think about buying. Leasing is by no means limited to company cars. The trend “renting instead of buying” is becoming more and more in focus – in everyday life, but also in the business world. More and more objects can be leased – for example, machinery, technical equipment or IT technology.
Starting with the copier, computers, monitors, software and entire services can also be purchased for a monthly fee. According to current figures from the Federal Association of German Leasing Companies, around 78% of new leasing business in 2019 will be for passenger cars and commercial vehicles. In second place is “production machinery” with eight percent and closely followed by “office machinery and IT” with five percent.
What are the advantages of IT leasing for my company?
1. preservation of liquidity and equity
IT leasing conserves equity and strengthens creditworthiness vis-à-vis banks and investors. The equipment remains the property of the leasing company during the leasing period, so that – unlike in the case of a purchase – the ratio of equity to total assets and equity to fixed assets does not deteriorate to your disadvantage. They use state-of-the-art technology and at the same time improve the credit rating, balance sheet ratios and thus the company value.
2. tax benefits
All costs incurred (i.e. the leasing installments) are immediately deductible in full because the leased object is assigned to the lessor for tax purposes. Instead of capital expenditures, operating expenses are due.
3. financial planning security due to fixed agreed installments
Leasing creates financial freedom. Instead of adjusting the IT modernization to the quarterly figures and investing when it just fits into the planning, you can deduct the rental hardware monthly as a business expense. In this way, exploit all the opportunities that the increasing digitization of business brings.
4. enables larger investments at an earlier stage.
Without having to spend equity capital, leasing allows you to follow innovation cycles sooner and faster and to always use state-of-the-art equipment and applications without burdening your budget. Leasing providers often offer a combination of leasing contract and IT services such as support (1st level, 2nd level) or backup management. This saves valuable time when searching for IT service providers.
5. flexibility and agility through constantly updated technology.
Theoretically, desktop PCs should be replaced with new devices every three to four years. The practice often looks different. In the midmarket, investments arrive in the IT department when there is still money left over. And even here, it is difficult to reconcile the requirements of the users with the cost vision from management. Acquisition at the time of purchase ties up capital, and because of short innovation cycles, many devices are obsolete before they pay for themselves. With IT leasing, you always get the latest equipment and software solutions. Many entrepreneurs argue with the words “Everything is running as it should, we don’t want to replace anything” – this may be correct, but the IT security aspect is completely left out of the equation here. Old devices also mean higher security risks and vulnerabilities to pests or industrial espionage.