Are thoughts of debt preventing you from getting crane equipment financing? If so, perhaps you don’t understand the benefit of spreading costs over time. In fact, the benefits of equipment financing can more than offset the additional cost of money. Be smart about determining finance options and choosing a lender. Most importantly, crane equipment financing can save your business money, both directly and indirectly. To illustrate how you might save money with crane equipment financing, consider the following items. First: A Note on Inflation If you have at least a basic understanding of economics, you’ll know that inflation is the general rise in prices which takes place over time. It’s best though, not to think in terms of prices going up, but instead to think of inflation as a reduction in the value of money. For example, assume inflation is at two percent and you buy an item for $100 today. If you buy that same item one year from now, your $100 won’t be enough. You’ll need to pony up $102 instead. In other words, your $100 loses value or “spending power” over the course of a year. Reality #1: Borrowers Benefit from Inflation Inflation works in your favor when you take advantage of heavy equipment financing, especially if the rate of inflation rises more than expected over the term of your loan or lease. This is simply a result of reduced value of the money that you pay back over time. In terms of real value, the cost of paying your equipment financing provider will reduce as time goes on. The inflation effect is particularly pertinent to crane equipment financing, because these assets are typically slow to depreciate. To benefit from inflation in this way, you’ll need to raise your business prices in line with the inflation rate. Doing so ensures that over time, your heavy equipment finance repayments will use a decreasing portion of your income. Reality #2: You Can Buy Equipment to Save Money For most businesses that use heavy equipment there are certain machines which can dramatically reduce the costs of operation. They can perform tasks more quickly, more effectively, or sometimes perform tasks which would otherwise be impossible. For example, if you’ve ever seen a $500K lumber harvester strip a tree plantation, you’ll understand just how many labor-hours one machine can save. By taking advantage of new or used equipment finance to buy machines that reduce labor in this way, it can be possible to generate sufficient savings to fund the monthly payments. The result is a net zero percent increase in spending. If you’re fortunate enough to be able to pay a few hundred thousand in cash for a piece of equipment, you’ll have to wait some time for savings to accumulate and equal the cost of the machine. Save as You Pay with Equipment Finance Whichever way you look at it, purchasing heavy equipment is expensive. However as these examples have shown, cash is not always the cheapest way to pay — and unless your business is cash rich, it’s certainly not the easiest.