Photo by Elle Hughes on <a href="https://www.pexels.com/photo/man-and-woman-wearing-black-and-white-striped-aprons-cooking-2696064/" rel="nofollow">Pexels.com</a>
Investing in good quality equipment for your business is important – such equipment is good for your brand image, it will make your business more efficient and it will likely last longer.
That said, it is possible to go overboard and spend too much money on equipment. This could include buying equipment that’s beyond your needs or simply getting ripped off by high prices or high interest rates. Below are just a few considerations that can help you determine whether you’re spending too much money on business equipment.
Have you taken the time to shop around?
When purchasing equipment, it’s essential to spend time shopping around so that you can get the best deals. This is particularly important when it comes to expensive equipment such as multiple computers, catering equipment or manufacturing machinery.
Don’t just shop through generic vendors where you may have limited options. Instead, look out for specialist vendors – for example, when looking for lab tables, look for school equipment vendors that are likely to have a larger range. This allows you to compare different options.
When it comes to custom equipment, it’s worth comparing quotes from different bespoke manufacturers. Don’t always go with your first quote.
Are you buying equipment beyond your needs?
You should avoid buying equipment that is far beyond your needs. You don’t want to be paying extra for features and perks that you’re never going to use. An example could include buying an industrial printer that can print off 30 sheets of paper per minute – this is all very well if you’re running a printing company, but could be unnecessary for your average office.
List your needs before buying new equipment and check reviews to work out exactly who the equipment is aimed at. This ensures that you’re not splashing out money on equipment that you won’t get good use out of. This is particularly important in the highly specialised industries. For example, if you oversee pharmaceutical processes then you should make sure to evaluate your requirements precisely before using pharma mixing equipment, as it will ensure that you purchase the correct options and help to avoid unnecessary expenses on features that may not align with your production demands.
Is there equipment you could be hiring or outsourcing?
When it comes to seldomly used equipment, there is usually no point in buying such equipment. Hiring this equipment or outsourcing it could save you a lot of money.
For example, a lot of farms find it more convenient to hire out a combine harvester during harvest time rather than buying one. If you can’t drive a combine harvester, it could also be worth outsourcing a farmer who can drive it rather than paying to get trained.
Of course, it is possible to buy such equipment and rent it out when you don’t need it to make some money. Just make sure that you’re prepared to rent your equipment out to other businesses.
Are you getting the best interest rates for your debts?
A lot of companies buy equipment using a loan. When borrowing money for equipment, it’s important that you don’t get ripped off by high interest rates. Always shop around for the best rates rather than opting for the first loan you can find.
Know when to refinance your debts – if you’re half-way through paying off a loan and you’ve noticed that the interest has been going up, it could be worth looking into cheaper loans that will save you money in the long run. Working on improving your credit score could help you to access cheaper loans.
