Home
Blog
Equipment Leasing Business Plan

Published Jul.05, 2023

Updated Apr.22, 2024

Equipment Leasing Business Plan

Name: Equipment Leasing Business Plan
Item: Equipment Leasing Business Plan
Author: Jakub Babkins

By:

Jakub Babkins

Article Business Plan Templates Real Estate Business Plans

Table of Content

1. What Is Equipment Leasing?

Equipment leasing provides businesses with a financing option to obtain the necessary equipment for their operations without the commitment of purchasing it. This arrangement allows businesses to utilize the equipment for a specific duration, ranging from a few months up to five years or even longer in some cases.

The lease agreement typically involves the business paying a fixed monthly amount over the lease term that covers the equipment cost and interest. The business then can either return the equipment to the leasing company at the end of the lease term or purchase it for a predetermined price.

2. Executive Summary

Why do you need a business plan for the Equipment leasing business?

When embarking on the journey of establishing a thriving equipment leasing business, crafting an impeccable business plan assumes paramount importance. Moreover, it encompasses a thorough competitive evaluation alongside a meticulously devised marketing strategy. Moreover, essential information regarding key personnel is also provided within this crucial blueprint.

The small equipment leasing business plan template serves as a vital organizing document with multiple functions.

Start your Business Plan Now

Start My Business Plan

How to write an executive summary for an Equipment leasing business plan?

The Executive Summary is the most important element of your equipment leasing business plan sample, like the Car Rental Business. It should detail your objectives, key target markets, competitive advantages, and how your leasing business will provide value to your customers.

Specifically, the Executive Summary should include the following:

Company Information: State the company’s name, its legal structure and ownership, contact information, and the location of the leasing business.
Objectives: Describe the company’s goals and ambitions.
Description of the Business: Explain why your leasing business is needed and distinct from its competitors, and provide an overview of the services you offer.
Target Markets: Identify and profile the key customer segments.
Competitive Advantages: Describe how your equipment leasing business will differentiate itself from its competitors.
Financials: Summarize the financial projections for the business and describe the amount of funds needed to get the business off the ground.

3. Company Overview

History of the Equipment Leasing Company

Equipment leasing is one of the world’s oldest and most well-developed financing types. The company that this business plan is for is a long-standing financing provider with over 25 years of industry experience. Over time, the company has solidified its position as a leading provider of both short-term and long-term equipment leasing plans. Additionally, it has successfully executed numerous sale-leaseback transactions.

The company, similar to the Tent Rental Business, primarily focuses on offering financing solutions to small and medium-sized businesses. It provides a range of financing options to its clients, including dollar and percentage leases, capital leases, sale-leaseback transactions, master-variable rate agreements, and lease line agreements. In addition to this, the company also offers consulting services that help clients compare different equipment types, suppliers, and costs. This helps them make informed decisions before entering into any financial contracts.

The improved version of the sentence is as follows: The company takes pride in its deep understanding of complex financial instruments associated with equipment leasing, its commitment to exceptional customer service, and its capacity to develop and offer tailor-made solutions for every client.
[related_business_plan id=”515″ layout=”horizontal”]

Mission

The mission is straightforward: to offer customers the best financing solutions. Their aim is to excel in the industry by providing customized and user-friendly options for restaurant equipment leasing and other needs.

4. Products and pricing

Cash Flow Financing: term lengths ranging from 24 months to up to 30 years, depending on the asset type, value, and specifics of the transaction. Upfront payments are similar to other equipment leasing options.
Operating Leases: short-term leases with terms ranging from 1-5 years. No upfront payments are required.
Percentage or Fair Market Value Leases: term lengths ranging from 1-5 years with fair market value buyouts at the end of the term. There is no upfront payment required.
Sale-Leaseback Transactions: term lengths ranging from 1-3 years. Upfront payments are required, and these transactions depend on the asset’s value at the beginning of the term.
Master Variable Rate Agreements: variable rate financing programs that adjust monthly payments based on the changing interest rate environment. Generally, these agreements are paired with a fixed-rate option.
Lease Line Agreements: agreements in which the lessee is pre-approved for periodic borrowing up to an established credit line. Payments are determined based on the borrowing amount, and terms range from 12-24 months. Upfront payments are not required.

5. Customer Analysis

Customer Segmentation

The customer base of business plans for equipment leasing consists primarily of businesses that need access to specific pieces of equipment to remain operationally competitive but lack the capital to purchase the equipment outright. Generally speaking, the customer segmentation within the equipment leasing market is structured broadly as follows:

Large business sector: The leasing market mainly focuses on large business operations, such as major corporations and government entities. They tend to have ample access to capital and thus are able to negotiate lower leasing rates, more comfortable repayment terms, and additional benefits (i.e. more lenient maintenance requirements).
Small and medium business sector: This segment consists of smaller businesses with fewer resources and tighter budget constraints. As such, these businesses should be offered more attractive leasing packages that include lower deposits, more flexible repayment periods, and additional pre-payment incentives.
Non-profit and charitable organizations: Non-profits and charitable organizations typically lack access to a traditional credit rating system and thus cannot access the more competitive leasing contracts available to larger, more established businesses.

Any questions? Get in Touch!

6. SWOT Analysis

SWOT analysis is a strategic planning tool utilized to evaluate the strengths, weaknesses, opportunities, and threats of a business, like in the case of Mortage Broker Business Plan. Strengths refer to internal factors that grant a business an advantage, while opportunities denote external elements that offer potential advantages. Weaknesses represent the internal factors that pose a disadvantage, and threats represent the external factors that pose a disadvantage.

Strengths

Experienced and knowledgeable staff
Ability to provide attractive and competitive rates
Established relationships with creditors and lenders
Strong customer service record

Weaknesses

Lack of online presence
Limited growth potential
Lack of market exposure
Limited financial resources

Opportunities

Expansion into new markets
Offering customized leasing options
Utilizing relationships with creditors and lenders to secure better deals
Developing an online presence

Threats

Rising competition in the leasing industry
Changes in consumer demand
New regulations and laws
Unexpected economic downturns

7. Marketing Analysis

Competitors

Competition in the equipment leasing industry is fierce as several large financial institutions are offering competitive leasing services and rates.

Note

he industry’s leading competitors encompass Wells Fargo, US Bank, SunTrust Bank, Bank of America, BB&T, BBVA Compass, and PNC Bank. These institutions offer diverse leasing options and possess a robust brand presence.

Market trends

Recent developments in the construction equipment leasing industry have been strongly influenced by advancements in technology and innovation. As technology continues to progress, leasing companies are now offering specialized services for cutting-edge, technology-intensive equipment.

Competitive Advantage (USPs)

The company’s competitive advantage stems from its flexible leasing options, personalized services, and specialized solutions. Additionally, they leverage established partnerships with a range of equipment suppliers to ensure clients receive optimal leasing arrangements.

8. Marketing Plan

Landlord Business Plan Writing

Helps commercial tenants get landlord approval.

The marketing plan of the equipment leasing broker aims to showcase their business capabilities to potential clients. This plan will primarily focus on two core areas: digital marketing and traditional, offline marketing.

Digital Marketing

For digital marketing, they will leverage websites, social media platforms, and email campaigns to reach potential clients.

Offline Marketing

For traditional, offline marketing, they will be looking to leverage connections in the industry to promote their business.

Promotions Strategy

The promotions strategy has the aim of increasing awareness and generating service leads. It utilizes a combination of online and offline tactics to connect with potential customers. To enhance lead generation, promotional campaigns are employed, which include discounts, free trials, and referral programs. Additionally, customer loyalty programs offer benefits such as discounts and rewards in order to incentivize repeat business.

9. Management Team

Organizational structure

The management team for the equipment leasing business plan consists of the following personnel:

Chief Executive Officer
Chief Operating Officer
Chief Financial Officer
Chief Marketing Officer
General Manager
Business Development Director
Location Manager

Any questions? Get in Touch

10. Financial Plan

Startup Costs

To launch a heavy equipment leasing business, it is estimated that the following startup costs are required:

Business registration: $500
Liability insurance: $500
Office rent: $2,000
Equipment: $10,000
Business licenses and permits: $500
Legal and accounting services: $2,500
Business stationery and supplies: $1,000
Furniture: $3,000
Office equipment: $2,000
Miscellaneous: $2,000
Advertising and Promotion: $1,000

Total startup costs = $24,500

Financial Projections

Below are the key assumptions that have been used to project the financial performance of the equipment leasing business:

Annual lease rate of 8%
Monthly lease payments of 1/12th of the total lease amount
Overhead costs of 10% of annual revenues
Lease portfolio of $300,000
The collection rate of 95%

Below is a table outlining the financial projections for the equipment lease business plan over three years:

1st Year:

Revenue: $36,000
Operating Expenses: $3,600
Net Profit: $32,400

2nd Year:

Revenue: $40,800
Operating Expenses: $4,080
Net Profit: $36,720

3rd Year:

Revenue: $45,600
Operating Expenses: $4,560
Net Profit: $41,040

Funding Ask

The funding asks for the equipment leasing business is $24,500. This capital will cover the initial startup costs, such as business registration, liability insurance, office rent, equipment, business licenses, and so on. This amount is required to launch and get the business off the ground.

11. Why Choose OGS Capital’s Equipment Leasing Business Plan Writing and Consulting Services?

Linda K.

Trustlink

Very professional

Had a great experience with OGS, especial ly Alex. Understood exactly what I wanted and did the job when promised. I was little skeptical about them at first but they definitely were amazing. Very happy with the work. I highly recommend them!

∙ Linda K.

OGS Capital specializes in providing strategic equipment leasing business plan planning services to entrepreneurs and business owners seeking to optimize their resources. Our team of experienced business consultants boasts a wealth of knowledge and expertise in the equipment leasing industry, accumulated over the course of a decade. We have successfully crafted comprehensive business plans for numerous leasing companies, witnessing their remarkable growth and ultimate success.

The equipment leasing industry’s specific requirements are well understood by us. We provide efficient, effective, and appropriate solutions that cater to the needs of all parties involved in order to ensure seamless operation.

12. FAQ

Q. What is the easiest way to finalize an equipment leasing business plan?

The easiest way to finalize an equipment leasing business plan is to compile all the required components into one document. This document ought to contain several key components. Firstly, it should include an executive summary, which provides a concise overview of the entire plan. Secondly, it needs to have a detailed description of the products or services being offered, providing comprehensive information about their features and benefits.

Q. Where can I download the equipment leasing business plan in PDF format?

You can find a free, comprehensive Equipment Leasing Business Plan in PDF format from Score.org.

Illustrative business plan samples

OGSCapital’s team has assisted thousands of entrepreneurs with top-rate business plan development, consultancy and analysis. They’ve helped thousands of SME owners secure more than $1.5 billion in funding, and they can do the same for you.