Bookmark and Share

Three Reasons to Keep Leasing in Mind When Financing

Being independent is at the crux of small business, no matter what sector of the economy you're in, and owning your own truck seems like the default way to get there in the trucking business. But being an owner-operator doesn't require you to own your truck outright, and many times the best business decision you can make is leasing your truck through any number of avenues. Here are three reasons why you should consider leasing over truck ownership.

1. Think about how you want to work independently as a truck driver. If your goal is to be an owner operator, you don't actually have to own a truck to succeed. Instead, you can lease your truck either through a carrier, which gives you relative security if you're a newer truck driver because your loads are also provided, or through a third-party, under which you can either lease to own or lease cyclically. Before you start down the road of thinking owning a truck is the only way to be an owner operator, explore your options and find the best option for you.

2. Look at the numbers. Leasing companies, whether they're a carrier or purely a car dealership, and truck sellers figure out the math behind what deals are profitable for their businesses, and you should do the same. Calculate the total costs of financing, the actual cost of the vehicle, and incidental and repair costs that are likely to occur during the life of the vehicle. It's a bumpy road, and some of those larger repairs can stop you in your tracks.

3. Make ownership a potential (and testable) long-term business goal. Most companies, especially small businesses, measure their business's progress and longevity through achieving goals instead of purely quantitative measures. If you want to become an owner-operator, make an estimated expense record for the cost of ownership, potential breakdowns, and annual maintenance. Be sure not to underestimate potential costs and hiccups along the way: misjudging expenses is one of the most common harms new businesses have to overcome. Over the next year, start to put aside that money, or that money minus the cost of leasing your truck in the meantime. If it's difficult to turn a 'profit' with these forecasted constraints, it might be better for your personal bottom line to lease instead of own.

Having more information on your side is invaluable when you're making business decisions, especially about something as capital-dense as your truck. If you'd like to learn more about different options for leasing, please contact National Truck & Equipment Sales.