5 Ways Asset Finance Can Be Used to Grow Your Business
Growth is the lifeblood of any business, but growth often requires capital, and that can occasionally be tough to come by. Acquiring asset finance is particularly valuable for small to medium-sized businesses that want to grow without staring down a heavy upfront investment. This can often be a barrier to scaling up, which is why the diversity of financing options in Aotearoa is a big relief.
In fact, with so many options to choose from, some business owners might even find themselves a bit overwhelmed. With that in mind, we’re dedicating this blog post to unpacking what asset finance is and reviewing five ways that it can be used to grow your business.
First, What is Asset Finance?
In short, asset finance is a tool many businesses use to buy or lease the assets they need to operate on a daily basis.
Most owner-operators use this kind of financing as a way to start their businesses with enough liquidity to manage any unexpected obstacles or to equip themselves for an expansion while preserving their usual cash flow.
How Asset Finance Can Be Used to Grow Your Business
Expanding Your Fleet with Vehicle Finance
If you run a business that relies on vehicles, keeping your fleet reliable and up-to-date can make a world of difference. Vans, utes, trucks, long-haul, regional, specialised: they’re all covered under the right vehicle finance plan.
These plans help you to expand or upgrade your fleet as-needed without draining your bank account. You can focus on all the logistical needs that will crop up once you adopt more vehicles into your business while remaining liquid enough to continue growing and managing new obstacles.
For example, a courier company could use this type of asset finance to replace its ageing vans with newer, more fuel-efficient ones to save on running costs down the line.
Upgrading Technology with Equipment Finance
If vehicles are not as central to your business, you might find that other mechanical equipment is in need of an upgrade. Having the right tools is key to staying ahead of the game in business, and equipment finance gives you the leeway to invest in the latest technology to put your business ahead of the rest. This way, you can keep your cash flow steady while laying the groundwork for expansion or upgrading how you do business.
For example, a construction worker might finance new excavation gear for faster on-site work. This would allow them to speed up jobs and take on larger projects for commercial clients.
Covering Seasonal Needs with Working Capital Finance
Seasonal highs and lows do many things, and one of the most important to watch for is the strain they might put on your cash flow. To help give you breathing room during quieter periods, or to help you scale up operations to manage higher seasonal demand, working capital finance is a helpful choice. Think of it as a way to smooth out bumps so that you’re always ready for what comes next.
A retail provider might use working capital finance to stock up on extra inventory ahead of the busy Christmas season without dealing with the financial stress of an upfront payment.
Securing a Premises with Plant Finance
Outgrowing your current setup? Plant finance is a category of asset finance dedicated to helping you lease or buy the right premises to match your growing needs. Factories, warehouses, and workshops: all of these expanded properties are applicable, depending on your investment plan.
Local food producers might use plant finance to move into a larger facility to accommodate higher demand.
Fund a Project with Working Capital Finance
Finally, businesses are historically built on landmark projects or products that help them get a foot in the door. Choosing working capital finance can help you to launch a new product line, expand your service offering into new markets, or take on a larger class of client. They’re a ticket to seizing opportunities when they arise without overextending your finances.
You might see this kind of asset finance in use with creative agencies who need to hire extra staff to handle a new major campaign or any other similar need.
As you can see, asset finance is more than just a funding option; it’s a way for you to grow your business safely. Whether you’re expanding your fleet, upgrading your tech, or navigating a spike in seasonal demand, picking a tailored plan can provide the support your business needs.
The key word there is ‘tailored’ because all plans should be carefully selected for your particular needs! That’s why it helps to speak to an advisor who can help introduce you to your options.
Ready to scale your business?
Whether you’re a small business or a large operation, you’re dealing with constant capital requirements. Navigate them with the help of our GVK Finance specialists, who are tapped into the network of asset finance plans across New Zealand.
Talk through your needs, explore your options, and land on the plan that works for you with a GVK Finance expert. Get in touch today to begin!