Friday, April 8, 2011

Rentals: Advantages of Renting vs Buying.

Cash Flow Conservation

When you place your essential equipment on a rental, there is no deposit required and no significant cash outlay from your cash flow. You can now use your cash more effectively by investing it, rather than using it for business infrastructure. You can benefit a lot from this free cash.

Off Balance Sheet Financing

Properly structuring your equipment rental results in additional benefits which have immense implications on the business profitability.


Being flexible when it comes to payments, photocopier upgrades and the addition of more technology to meet your business needs means that a rental solution allows you the freedom to expand and grow your business at your own pace.

Reduced Total Cost of Ownership (TCO)

Total Cost of Ownership should be calculated by all institutions. Even a single PC has cost factors associated with it and one must be aware of the effect that purchasing has on the total cost of ownership. Managers are advised to use a least an average cost per computer to plan for expenses and also allow comparisons in the decision-making process.

Credit Line Preservation

Renting allows you to preserve the available credit from your bank for additional working capital, operations, expansion and acquisitions. When conducting equipment financing through your bank, you usually exhaust your available credit. Not a good option for any business wanting to grow.

Asset Tracking

An asset tracking system allows clients to know where their assets are at all times. This is very important for many of our clients. When a client rents his assets from us, they are able to log-in to our website and see exactly what assets they have on rental. All upgrades and maintenance done by Spartan is also recorded. The client is then able to allocate each asset to different offices, departments, regions etc. This offers a live instant record of exactly what assets they have and where they are. You always know where your equipment is and can control it instantly.

Easier Budgeting

Having the expenses amortized over the rental term allows your organization to effectively budget over the term of the rental. This means that you always know exactly how much cash you have available each month and can better plan your finances accordingly. Efficient planning leads to profit increase.

IT Asset Lifecycle Management

Hardware and software assets, like any other assets, are acquired and then, eventually, retired. A rental solution manages the lifecycle of the asset through Procurement, Deployment, Upgrades, Maintenance and, finally, Retirement. This reduces your costs as well as your risks, while increasing your service quality. Literally a cradle to grave service for the equipment.

IT Benefits (CIO)

Financial Benefits (CFO)

Fast delivery of equipment

No large cash outlay

Up-to-date technology

No depreciation

On-site maintenance

Hedge against inflation

Flexibility – match computers to business needs

Improve against ratios

Upgrade and add-on at any time

Tax benefits

IT departments can focus on core-issues

Improve balance sheet gearing

Software on demand

Free working capital

Rental payments are flexible

Asset tracking and asset management

Administration time is slashed

Reduced risk