The Future of Equipment Leasing: Trends and Predictions

The Canadian Rental Association is predicting a 5% growth in the equipment rental industry in 2023 — but what exactly is equipment leasing? 

Equipment leasing is a business practice that enables the usage of equipment — without the burden of substantial upfront costs. Especially in industries like construction, new technology and innovations are constantly coming into the market, so equipment leasing helps businesses stay ahead of the curve without constantly having to buy new equipment.

In this blog, we’ll break down what is going on in the equipment leasing industry around us — including emerging trends that will affect future leases on tech and other equipment needed for day-to-day business activities—and offer our predictions about how these trends may affect your bottom line. Read on for more information about these new changes coming into play and why equipment leasing should still be a part of your strategic, long-term plan.

Benefits of equipment leasing for businesses

In the business world, having access to the right equipment and tools can make all the difference in achieving success. However, purchasing high-quality equipment can be a significant financial burden, especially for small businesses with limited budgets. Fortunately, equipment leasing provides a practical solution to this problem. By leasing instead of buying, businesses can access the latest technology and equipment without the high upfront costs associated with ownership.

Leasing also provides flexibility by allowing businesses to upgrade or switch out equipment after the end of their lease term. This allows businesses to focus on their core operations and maximize their ROI with ease. Ultimately, equipment leasing offers businesses a cost-effective and efficient way to stay competitive and profitable in today's fast-paced business world.

Overview of current trends 

One major trend that has emerged in the equipment leasing industry is the use of Internet of Things (IoT) equipment monitoring. IoT enables the connection of any object to the Internet and provides valuable data so you can take the right actions and measures. This technology enables companies to remotely track equipment usage, temperature and more, which can help prevent breakdowns and improve overall efficiency. 

Another development that has gained traction in recent years is the use of Artificial Intelligence (AI) for maintenance. Automating as many manual processes as possible, including maintenance, can save time and resources for other human-led tasks. By analyzing data from IoT sensors, AI can boost their operational efficiency, predict when maintenance is needed, establish better risk management, and avoid unplanned costs, thereby reducing downtime and saving money. 

More and more companies are spending time and resources on becoming environmentally responsible and conscious, and the equipment leasing industry is no exception. Adding sustainability measures into the business operations equation not only contributes to environmental preservation, but also leads to better usability and the lifecycle extension of equipment. Managing assets in a sustainability-minded way drives better business outcomes and supports the customer’s increasing demand and changing preferences for eco-conscious business decisions.

Predictions for the future

The future of the equipment leasing industry looks bright with technological advancements paving the way for innovative solutions. One such technology is blockchain, which has the potential to revolutionize the way businesses operate. By enabling secure, decentralized transactions, blockchain could substantially reduce transaction costs and increase efficiency. 

Smart contracts, which are self-executing agreements, could also play an important role in improving business operations. Software specific for the leasing industry is also becoming more widely available, leading to greater automation and therefore lower costs. 

Meanwhile, customer expectations are changing, and sustainability is becoming a critical issue. Businesses that prioritize sustainability will have a competitive edge, as consumers increasingly demand environmentally conscious practices.

And as customers seek greater flexibility, businesses that offer alternative leasing models may have an advantage over their competitors. 

Challenges of equipment leasing

As businesses continue to grow and expand, the need for proper equipment becomes increasingly important. Equipment leasing has become a popular solution for business owners to acquire the necessary tools and technology without breaking the bank. However, while it may seem like a simple and effective solution at first glance, equipment leasing comes with its own set of challenges. 

One of the main challenges that businesses face is understanding the terms and conditions of the lease agreement. It's important for business owners to carefully read and understand the fine print to avoid any unexpected fees or penalties, and work with their accountant to understand how their taxes are affected. In addition, businesses must also consider the cost of maintenance, repairs, and upgrades for the leased equipment. It's crucial to plan for these expenses and make sure they are within budget. With proper research and planning, businesses can successfully navigate the challenges of equipment leasing and reap the benefits of having the latest tools and technology at their disposal.

It can also be hard to find a leasing company that has the equipment you need, while also prioritizing quality and performance. With the industry predicted to grow, more choices for equipment leasing companies may become available, but they might not all provide the level of service and quality that you would hope for. It’s important to research and find a company with multiple years of experience, who takes into account the unique needs of your business, and builds a plan that works with, and for you.

What we do at Arbutus Capital 

Arbutus Capital has established itself as a reliable provider of quality services to businesses for over 40 years. Our equipment leasing services have been a game-changer for many small and medium-sized enterprises. With this service, businesses can access the latest equipment they need to operate, without having to incur the huge capital expenditure associated with purchasing new equipment outright. This has enabled these businesses to harness competitive advantages and increase efficiency. Our commitment to providing reliable and efficient services has ensured that we remain the go-to option for businesses looking for a partner to help them grow.

Make the most out of equipment leasing services

Equipment leasing can be an excellent option for businesses looking to acquire the equipment they need without a large upfront investment. To make the most out of equipment leasing services, it's crucial to do your research. Take the time to compare pricing, terms, and conditions from multiple providers to find the best fit for your business. Additionally, make sure to confirm the maintenance and repair responsibilities of each party involved in the lease agreement, as well as the termination process. Maximizing the benefits of equipment leasing requires careful consideration and diligence, but it can help businesses save money, improve efficiency, and stay competitive in today's fast-paced market.

In conclusion, equipment leasing is a great asset to businesses of all sizes regardless of industry. The trends in the industry show us that this type of financing isn’t going anywhere any time soon—in fact, many are expecting it to become even more sophisticated in the near future with the help of technology-driven features. Yet challenges remain, from keeping up with customer expectations to staying ahead of compliance requirements. 

With Arbutus Capital, you can be sure you're getting high-quality services and support from knowledgeable experts in equipment leasing. Our team will guide you through every step of the process, helping you make the most out of your financial decisions along the way. Contact us today to get started with the equipment lease your business needs — we are here to create a tailored solution that fits your unique requirements.