Times are inevitably tough. Covid-19 might have impacted your business and reduced your profits. If you’re on the hunt for a new van you might be contemplating a variety of options. You don’t always have to purchase a new van as there are multiple options at your disposal. The most popular choice people have to make is whether to lease or buy your new van? We’re going to run through the most important information here in order to help you make the right choice for your business.
1.First up, what’s the difference between leasing or buying a new van?
When you buy a van it means you need to have the disposable income in it’s entirety immediately. So, this either means applying for a loan or forking up the cash. The benefit of buying a van is that it belongs to you and you are able to make any upgrades or modifications to it. It is also an asset. When leasing a vehicle however, you do not own it. Instead you pay a monthly fee for the privilege of using the van. However, with leasing options you can pay a lump sum at the end of the term in order to purchase the van outright.
So, what are the benefits or purchasing a van?
Firstly, buying a van tends to offer better value in the long run. If you are in a position to pay cash then you will be in an even better position as this form of payment can get you a great deal. However, if you are intending on paying in cash your van you need to ensure that the seller is legitimate and reputable. You also must take the responsibility for ensuring that you get a legitimate invoice.
If you are opting to buy a new van and you already are the owner of an existing van, then you might be in a position to trade in your old van for a new van, this means that you can save even more money on the new van than you previously might have intended. The price you will receive for your old van will depend on a number of factors such as condition for example. If your van has been effectively maintained through out it’s life span, has had adequate servicing and is in all round good condition, then you could get a great price. It’s important to stress the importance of also having a clean van inside and out when you are attempting to trade in your van.
When you purchase a van yourself, you are also not restricted to mileage. This is usually a very important factor for van owners because if you have a lot of travelling to do in your work capacity you might not want to be constrained to a limit.
Finally, if your purchase a van, it’s yours. If you want to make changes to it, swap it or sell it you can do so. You have full autonomy over your own van, which is a bonus you do not have with a lease.
What are the benefits of leasing a van?
The first benefit of leasing as opposed to buying is the financial element. When you lease a van, you aren’t expected to have the full lump some in one go. The fixed monthly cost of a lease suits some van drivers or fleet managers better. There isn’t as much risk because the sum is less.
Another benefit of leasing is that you change your van every few years. Some drivers prefer the feel of a fresh van after a period of time while others treasure their old reliable. If you are someone who likes to keep on top of the latest vehicles, then leasing a van might be for you.
If you don’t like the risk of unexpectedly running into maintenance costs with your van, then a leasing option is another good choice. Many lease packages also include breakdown cover which is easier on the savings. If you run into trouble with your van or if you have a sudden breakdown your leasing company will cover the cost of repairs. This is major bonus of a van lease because maintenance costs can be high with vans.
If you are in between the leasing or buying option it’s good to be familiar with the difference between a straight lease or a lease purchase. A lease purchase unlike a straight lease gives you the option to buy the van. Usually a typical lease company will give you the option of both.
So how should you make you decision?
Sit down and weigh up your finances. Consider the lump sum of a new vehicle and also the depreciation. But consider the fact that the van will be an asset to you and your business, and you can always sell it on. Also consider if a lease might suit your financial situation and if the security of maintenance and repairs is something that gives you peace of mind.
If you have weighed up the pros and cons and you still can’t make decision, then it might be worth consulting someone in the industry who bought a van and someone in the industry who leases. There’s no review like one that comes from the horse’s mouth. There’s also a lot of information online.
At insuremyvan.ie, we want to help you and your drivers with peace of mind on the road. We have great cover at reasonable prices. Call us today!