How Leasing Can Profit Your Photography Business

Do you want to start a photography business, but does the thought of not having sufficient capital worry you? If so, you should look into photography equipment financing options like leasing.  This is a very popular choice amongst many entrepreneurs who set up their own photography business. And the reason it is popular is because of the immense benefits they provide -

• Cut Down Investment Costs: One of the largest investments when starting a photography business is the equipment. If you plan to be in business, then it is inevitable that you provide a high quality service. And to do so, the best photography equipment is a must. However, most of them are very pricey and this huge expense makes many prospective entrepreneurs delay the start of their business or even completely abandon it. With leasing, you do not have to worry about making any large investments in equipment. A lease only requires an advance of a few months’ payments. As such, you can easily start your photography business with limited capital. 
• No Collateral Required: If you think of financing the equipment purchase from any major bank, then the down payment requirement comes into play. The banks will usually expect you to contribute about 20%-30% of the equipment cost from your own funds. Only the remaining will be funded by the bank. A lease requires no collateral from you. When you take a lease, the photography equipment who obtain will be considered as collateral. This means that you will not have to provide any of your personal assets as collateral.
• Use The Latest Photography Equipment: Leasing allows you an incredible advantage in that you will be able to replace your existing photography equipment with the latest equipment very easily. To a photographer, nothing excites him more than using the latest cameras and other accessories. But if you purchase the equipment, then you will mostly be using that same equipment for a very long period. And even if a good equipment releases in the market, you may not be able to afford it because of the huge investment you made in the current equipment. But with a lease, you do not have this disadvantage.  If you see that a new photography equipment will help your business provide better service, you can just end the current lease and then start a new lease on the new equipment.
• Payment Exemption For First Few Months: With leasing companies, you may get a payment exemption for the first few months of a lease. What this means is that once the lease starts, you will not be required to pay the monthly lease amount for the first few months. This is extremely beneficial for a budding photography business since it will usually take a few months for your business to start generating sizable revenues. So you can wait until you begin to make sufficient money in order to start making the monthly lease payments. However, not every leasing company may provide this facility. So, make sure you ask them about this when inquiring about their service.

Types Of Lease

Once you have decided to obtain photography equipment by leasing, the next thing to decide is what type of lease you wish to take. Basically, you will be offered two types of leases – Fair Market Value lease and Purchase Option lease.

• Fair Market Value Lease: This is the cheapest option of the two. But a major drawback is that you will not be able to claim the property after the lease period – you will have to give it back to the vendor. So if you are okay with not owning the equipment once the lease ends, this is the option you should go for.
• Purchase Option Lease: As the name suggests, this lease offers you the option to purchase the equipment at the end of the lease period. This is the type of lease you should opt for if you wish to own the equipment at the end of the lease period. However, the drawback is that it charges a higher monthly payment amount than the Fair Market Value lease.

A lease is thus a good way to start your photography business with limited funds. Just make sure that you research the leasing companies in your area so that you can get a lease with the most beneficial terms.