Van Leasing or Buying?
Van Leasing or Buying? Which is Better for Your Business?
Do you need a new van for your business? Are you worried about the costs of a new van? Have you thought about van leasing? A van lease is a cost-effective alternative to buying a new or used van. But as with all business decisions, you need to ensure it is the right choice for you.
Understanding the difference between leasing and buying
There is one main difference between buying and leasing a work van. If you purchase the vehicle, you own it. You pay the entire vehicle value upfront or on finance; the vehicle is a business asset.
If you lease a van, the van remains the property of the leasing company. There are variations depending on the finance model, but generally, you pay a fixed monthly amount for the van and return it at the end of the contract.
Buying a new or used van
From the brief description above, it is hard to determine the benefits of leasing over buying. However, these lie in the ongoing costs of buying a new or used van. Purchasing a van requires significant investment. You need to raise either the total cost of the van or be eligible for finance. Even with a finance deal, you need a substantial deposit before you can drive away your van.
Owning the van outright means you are responsible for all vehicle maintenance, servicing, and repairs. Not having the money for parts or repairs can leave you without a vehicle and this can quickly affect your income. If you opt for a used van, these can mount up quickly. Depreciation is another concern. If you buy a newer model or change the type of van to suit changing business needs, you’ll need to sell the original van. Vehicles lose money quickly, and you will be out of pocket on your original purchase.
The main benefit of buying a van outright is that it belongs to you. It is your company asset to use or sell as you see fit.
Leasing a business van
Van leases are fixed-term agreements that give you full use of the van for a fixed monthly payment. Typically, leases last for two to three years. At the end of the term, you return the van to the company and either lease a new van or find an alternative arrangement.
Van leasing tends to be more affordable. There are lower upfront and monthly payments than for most other finance models. Payments are also fixed, so you know exactly what you are paying monthly at the start of the contract.
Most leasing companies include service, maintenance and breakdown cover in their packages, on top of the manufacturer’s guarantee. You benefit from lower ongoing costs, meaning more of your hard-earned money stays with you.
The lower costs often mean you can afford a better quality van than you could if you were buying outright. A larger or higher spec van helps your business stand out and gain more customers.
There are also no depreciation costs. At the end of the contract, you hand back the vehicle and start a new contract that is better suited to your needs.
Depending on your business model and the type of van you lease, several tax relief schemes can further reduce your costs.
Finally, there is the security of knowing that Express Vehicle Contracts is just a phone call away if anything goes wrong. We work quickly to put things right and get you back on the road.
If you are considering leasing, you need to consider mileage. Most leasing deals have a mileage limit, and going over that limit will add to your costs. The same applies to damage not covered by fair usage and wear and tear.
Van leasing with Express Vehicle Contracts
Express Vehicle Contracts has developed an incredible network of manufacturers and finance companies. We can offer you some of the best van leasing deals on the market. Whether you want something compact and agile or the latest electric van technology, we have you covered. Contact us today and see how we can help your business grow.
