The challenge facing you as an I.T. and/or financial decision-maker is to develop an effective strategy for acquiring and managing your company’s high-tech assets. Managing technology means being able to accommodate growth and change, rapidly and cost effectively. Today’s “new economy” and e-commerce world requires that you have the flexibility to embrace the changing market conditions.

Optimize end-user productivity
As more mission critical applications migrate to distributed platforms, I.T. departments must provide each end-user with the equipment and configurations that maximize individual satisfaction and performance. Leasing simplifies cost-effective upgrading, enhancement, or replacement of systems that no longer satisfy your productivity objectives.

Facilitate effective asset management
Most I.T. departments find decentralized assets difficult to inventory, track, and manage. Leasing these assets helps you gain and maintain tighter control by giving you the discipline to establish enterprise standards, and by helping you manage upgrades, configuration changes, and location moves throughout each asset’s useful life.

Why cost of funds is not an issue
When financing high-tech equipment, the cost of funds should be approximately the same whether you lease or purchase. The debt rate implicit in the lease is based on your credit, not the lessor’s. Even if there is a slight difference in the cost of funds, the relatively short term nature of a lease (three years or less), makes the impact of the difference negligible.

Why tax benefits favor leasing
With today’s depreciation schedules and tax rates, leasing typically results in a lower net cost of use when compared to purchasing. The ability to expense lease payments as they are paid offsets the accelerated tax depreciation available when high-tech equipment is purchased. In fact, given the typical two-year (or shorter) life of most distributed high tech equipment, the required 5-1⁄2 year MACRS (Modified Accelerated Cost Recovery System) tax depreciation cannot truly be called accelerated. The shorter your use of the asset relative to its MACRS tax life, the greater the relative tax benefits associated with leasing.

Utilize flexible financing options
Leasing distributed assets helps you reduce cost by taking advantage of leasing’s inherent capital-conserving capabilities. These include off-balance sheet financing, graduated or staggered lease payments, and preservation of lines of credit.

More organizations than ever are leasing their distributed technology assets. Please contact your FFCSI representative so we can begin to design a custom tailored leasing program for your company today.