Equipment Leasing vs Buying Cancel The title field is required!

1. Justin VanLanduit

   

   0 posts
   
   8/14/2012 7:08 AM

   Curious how many guys are leasing equipment these days versus buying the high use stuff like, grns, tee/app, fwy, rough mowers? I'm in a position right now where I have a large chunk of equipment that needs replaced as the hour meter keeps getting higher and the repairs keep adding up. Our equipment maintenance budget continues to creep higher and higher each year to hopefully keep our important equipment out on the course and not in the shop. I've presented to my Greens Chair the option of leasing these pieces of equipment to one help reduce costs for the time being but also to do a large package and beat the Tier 4 price increase on the fwy, and rough machines. Hoping to find more guys that are doing this and hear of the advantages they've seen with structuring and equipment inventory this way as well as the disadvantages.
   
   Thanks,
   Justin

   
   
   
   
2. James Smith

   

   113 posts
   
   8/20/2012 8:08 AM

   We lease to own with a $1 buyout. But we also keep equipment 10-15 years.

   
   
   
   
3. McCallum David K

   
   8/22/2012 6:08 AM

   At the time of our opening back in 1999 we leased. Turned the first lease over and did it again for another three years. But during the first two lease cycles the buyout at the end was known.........20% of the orignal value. So it was easy to determine to buy it out or turn it in. The first two cycles we bought at the end, then sold the equipment ourselves for a tidy sum and began again. But at some point the manufacturers wised up as did car lesors and it became market value. it benefited them more than us. At that point we began buying and gave up the lease option. Also the lease option will show up on your monthly financials as an expense item and that can be a substantial figure.