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The Top Three Advantages of Logging Equipment Financing

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Close up shot of a chainsaw cutting a log for Logging Equipment Financing page.

Logging and construction are some of the most important industries today. The demand for wood is going nowhere; in fact, it may be increasing. Having the right equipment can make all the difference when it comes to keeping your business growing and thriving all year long. 

The problem is simple: logging equipment is expensive. If you want your company to have access to the type of equipment that can keep up with big business and heavy demand, then you have two options. Either you need to have cash on hand to buy the equipment outright, or you need to look into financing options. 

Even businesses with the funds on hand to purchase machinery outright often lease or finance their forestry equipment. Leasing logging equipment or using small business loans offers numerous benefits for any company. Here are the top three advantages of financing logging equipment, whether you’re in construction, trucking, or any other industry. 

Maintain Capital

Heavy equipment can be a significant investment. For small businesses who rely on a consistent cash flow, this investment can drain their capital reserves and could lead to financial problems if an emergency happens.

On the other hand, financing and equipment leasing can help the company maintain that pool of capital for different needs. Small business loans are designed to help keep these businesses running smoothly without tapping their capital unnecessarily. Instead, these loans let you access the equipment you need while keeping cash on hand for other things. 

Improve Flexibility

Logging and construction equipment financing has more benefits than just keeping the business prepared for emergencies. It also helps the company stay flexible and ready to respond to changing markets. 

For example, leasing equipment is an excellent choice if you plan on upgrading your logging equipment regularly. Instead of relying on the ability to sell the equipment later to finance new machinery, you can work with the lease structure to ensure that you always have top-of-the-line equipment with less hassle. 

Maintaining capital also allows the company to access multiple, complementary pieces of equipment at the same time. Instead of just purchasing a log truck, you can finance excavators, mulchers, and skidders as well. As a result, your company is more well-rounded, more flexible, and better able to serve your customers. 

Increase Return on Assets

While buying equipment outright relies on the money you’ve already earned, financing allows your new equipment to pay for itself. When it comes to the accounting process, this often leads to a unique phenomenon: inflation causes the equipment to be paid for with “cheaper” future dollars. 

This is combined with the flexibility of financing to increase your total return on assets. You can earn more on a job if you have a full suite of equipment, raising your return on all the equipment involved. 

Logging is a difficult business, and it requires heavy-duty equipment. Your company deserves access to the equipment it needs to stay in the black. That’s why we at Coastal Kapital are here to make it as convenient and straightforward as possible to get the logging equipment financing you need. 

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