The value of struggling businesses opting for renting ahead of upfront purchases
Keeping upfront costs to a minimum is one of the central concerns that any company has as they set out into the world of business.
Everything from office premises to IT equipment needs to be considered at this point, and obviously the cost of paying for these will take a considerable toll on an emerging business.
However, it seems that a vast number of UK businesses have found a way around this problem. A new study indicates that a number of companies opt for the idea of renting/leasing a number of items instead of making an outright purchase.
Just under half of the 518 businesses questioned in the O2 Business report preferred to rent/lease a variety of items, with the most popular items to rent including a phone line (62% of those questioned prefer to rent than buy), office space (40%), water-coolers (21%) and IT equipment (11%).
Sensible step for struggling businesses
This approach to dealing with everyday costs is a particularly sensible precaution for struggling businesses to take. A company that is uncertain about the forthcoming quarter will subsequently be reluctant to commit to fixed costs. Renting basic items such as telephones and computers is a smart move in this context and could potentially save hundreds of pounds that can be put to good use elsewhere.
Specialist advice available
Renting items instead of making upfront purchases is just one of the many tactics that struggling companies might attempt during turbulent times. Underperforming businesses worried about their financial situation can benefit from seeking advice sooner rather than later.
A corporate insolvency specialist such as Moorfields can assist business leaders, financial directors and stakeholders. We can help them to deliver pro-active solutions for their business, as well as advice on how to adapt to the ever-changing economic landscape. This could be particularly useful given how uncertain the immediate future could be for companies across the UK in 2013.
If you would like to have a free no obligation chat with one of our advisers please call us on 0207 186 1143.