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Like all businesses, although possibly to a higher degree, the dry cleaning and laundry industry heavily relies on its equipment. It is pertinent to have current and well maintained dry cleaning equipment to increase customer satisfaction and provide faster service. Old and/or poorly maintained machines drive customers away and cause profits to drop. A great way to ensure you have the proper equipment is to lease it, giving yourself the ability to upgrade to the latest and greatest at a fraction of the initial cost.
What are the Benefits of Leasing Dry Cleaning Equipment?
Many business owners prefer the autonomy of owning their own equipment. However, there are numerous benefits to leasing, starting with paying less up front. This saves capital and credit for items you have no choice but to buy (both of which are often lacking in a new business). Leasing may also allow you to afford a higher quality machine than you could with an outright purchase.
You should also consider the maintenance and replacement costs that will occur eventually. Owning dry cleaning equipment outright places the burden (and price) of standard repairs and maintenance solely on you, whereas most leasing agreements include provisions wherein the vendor or the manufacturer takes care of any necessary tune ups. It is even easier to upgrade a unit when leasing, as you can just lease new or better equipment at the end of the leasing period. Some rental agreements even allow for upgrades based on the initial leasing contract.
The greatest benefit to leasing your equipment, however, is the customer satisfaction it brings. Leasing provides a way for you to have top of the line equipment that gets serviced on time by professionals, which in turn allows you to provide exceptional service to your clientele thanks to reduced downtime and increased productivity.
What Does it Cost to Lease Dry Cleaning Equipment?
The financing rates for equipment are based on many factors, including the location of your business, your credit score, and the size of the lease. Lower priced equipment tends to come with a higher financing rate than more expensive equipment. Prices that fall below $100,000 typically means financing rates between eight and twenty percent, with the finance rates for more expensive typically falling between six and eight percent.
- An Inno Clean ISP-60 shirt press machine costs around $20,000. Leasing this unit for 24 months would run $428.32 per month at 8% and $475.91 per month at 20%.
- A Fujistar ADT all in one single shirt finishing machine is priced around $30,000. A 24-month lease for this unit would cost $666.90 per month at 8% and $741.00 per month at 20%.
- A K4 Union Dry Cleaning Machine can cost around $110,000. A monthly lease, for 36 months, would cost around $2,527.86 at 6% and $2,575.56 at 8%.
Keep in mind that this is just a general pricing guideline. Each customer, vendor, and machine setup is unique, so payments will vary. Your credit score will play a very large role in determining the final cost of leasing dry cleaning equipment, with lower payments going to those with higher credit ratings. While you do not have much control over that and the pricing it will lead to, you can do things such as negotiate a lower total lease amount to help reduce your costs.
Things to Consider When Leasing
There are many things that you should take into consideration when deciding whether to lease or buy your dry cleaning equipment. Figure out how long you want to use that specific equipment. If you prefer to always have the most recent model or like to upgrade your equipment regularly, leasing is probably the better option for you.
You should also think about what you want to do with the equipment at the end of the lease. Will you renew it or return it? Or will you decide to upgrade? This is necessary knowledge before making any final decisions. But perhaps the most important factor to keep in mind is the big picture of your dry cleaning business: consider your needs as well as those of your customers to help determine whether leasing really is the right move for you.