When it comes to running a business, one of the most important investments you can make is in your company’s vehicle fleet. Whether you’re a construction company that needs trucks and heavy equipment, or a delivery service that relies on vans and trucks, having a reliable fleet of vehicles is crucial to the success of your business. A vehicle loan can help you get there.
6 ways your business can benefit from upgrading your fleet
Upgrading your business fleet with a vehicle loan can bring a variety of benefits to your company. Here are just a few examples:
Increased efficiency: Newer vehicles often have better fuel efficiency, which can help lower your fuel costs. They may also have features like GPS and telematics systems that can help you optimise your routes, reduce idling, and improve overall fleet management. Newer vehicles are also better for the environment by producing fewer emissions that contribute to air pollution. If your business has a commitment to sustainability, upgrading your vehicle fleet to low-emission or electric vehicles is a great way to show that you are investing in your values and attract like-minded customers.
Improved safety: Newer vehicles are often equipped with advanced safety features such as lane departure warnings, automatic emergency braking, and rear-view cameras, which can help reduce the risk of accidents and protect your employees. As a business owner, protecting your employees while they are in your care is something to take seriously. These safety features have the added benefit of reducing the number of small accidents your employees may be involved in that aren’t serious but still cost your business money.
Enhanced image: Having a fleet of newer, well-maintained vehicles can help project a more professional image for your company. This is especially important for businesses that rely on making a good first impression, such as delivery or transportation companies, salespeople or any vehicles that customers or clients will see. Chipped paint and small scratches and dings can also lead to bigger problems over time. These minor issues can lead to rust which can undermine the integrity of your vehicle.
Reduced maintenance costs: Newer vehicles typically require less maintenance and repairs than older ones. If your vehicles are on the road a lot, your vehicle fleet may need more and more maintenance year on year to keep them in safe, reliable condition. Constant repair bills can add up over time and impact delivery times and reliability. From a customer standpoint, investing in newer vehicles can ensure better reliability while lowering your overall maintenance costs.
Increased resale value: If you decide to sell or trade-in your fleet vehicles in the future, newer vehicles will typically have a higher resale value than older ones. Some advice recommends upgrading your vehicle fleet every five years. That number might be unrealistic for some businesses. A better rule of thumb is to upgrade your fleet when their running costs increase faster than the monthly capital cost of the vehicle decreases. For cars and light trucks that are continually on the road, this is around 3-5 years. If your business vehicles aren’t used continuously this number will be higher. Most business vehicles need major repairs once they hit 8-10 years old.
Attract younger drivers: If your fleet is old you may have trouble attracting a younger generation of drivers to your business. Not only that, the learning curve for adapting and driving your vehicles could be steeper. Drivers want vehicles that are comfortable and fitted out with modern technology, features and an assurance of safety when they step behind the wheel.
Upgrade your fleet with vehicle loan finance
While the importance of having a strong fleet is clear, many business owners overlook the hidden benefits of financing that fleet, rather than funding this upgrade yourself. Here are just a few of the ways that a vehicle loan can help your company grow and thrive:
Flexibility: When you finance your fleet with a vehicle loan, you can purchase new vehicles as needed without having to save a large lump sum of cash. This allows you more flexibility in purchasing the vehicles you want without straining your company’s finances.
Tax benefits: Financing your fleet can also provide tax benefits for your business. In many cases, the interest on a vehicle loan is tax-deductible, which can help lower your overall tax bill.
Improved cash flow: By financing your fleet, you can free up cash that would otherwise be tied up in the vehicles themselves. It’s always a good idea to have some money liquid, and help you invest in other areas of your business.
Preserve capital: Financing your fleet with a vehicle loan also allows you to preserve your capital for other essential expenses like payroll and rent. This will allow you to operate your business more efficiently and avoid any financial hiccups.
Better vehicle management: With financing, you can budget and plan for vehicle replacement, maintenance and repairs, which will allow you to have better management of your fleet.
Financing your business vehicle fleet may seem like a daunting task, but it can provide several hidden benefits that can help your company grow and thrive.
By providing flexibility, tax benefits, improved cash flow, and better vehicle management, financing your fleet can be a smart investment for any business.
At ThinkCap, we can find you the right loan to fund your vehicle fleet upgrade. Apply now for a tailored vehicle loan now.
