Why should my business consider leasing vehicles?
Leasing your vehicles when you run a business brings with it a number of different benefits, whether you have a fleet of just one, or 100, or even 1,000.
However it seems that many small to medium-sized enterprises (SMEs) are missing out on those benefits due to a number of blockers, or misconceptions, around issues such as business size and fleet management.
Here Mike Waters, head of marketing for Arval SME, busts some of the myths around leasing for SMEs.
My business is too small to lease
No business is too small. Even a “one man band” or sole trader, is big enough. At Arval SME the average number of vehicles per customer account is two, so clearly many customers are only sourcing one or two vehicles. Arval SME team is set up specifically to provide advice and guidance on the best leasing options for customers with only one car as much as for those with dozens of vehicles. If you need a van, their specialist knowledge is invaluable. For example rather than take the manufacturers stated load capacity figures Arval offers advice on post fit out space, crucial information to maximise cost and operational efficiency.
We don’t have enough people to manage it
Within the Arval SME team we are geared up to provide the same quality of advice to small companies or individual drivers. In essence we are your company vehicle manager irrespective of how many cars or vans you have and we are here specifically to help you.
I like the certainty of keeping my vehicles for as long as I want.
The maintenance required on a car or a van increases with age not only meaning more maintenance bills to be paid but also more time off the road and this can pose a problem. So with any car or van there is an optimum time to sell the vehicle that will avoid an increase in the cost of owning it.
Cars lose their value faster with age. Leasing companies are able to forecast the likely resale price to help you get the best price on the monthly rental fee. Plus the leasing company takes all the risk on the sale of the vehicle, so it the market takes a turn for the worse it won’t cost you a penny.
It doesn’t take much time to run company cars or vans
Often in smaller companies the time cost of running company vehicles is hidden as the actions can be split across a number of different people and also over a period of time.
For companies that allow employees to drive their own vehicles on company business the costs can be multiplied if the associated risks are to be properly managed.
When was the last time you checked your drivers have the correct insurance cover, that the vehicle is regularly maintained, taxed and Mot checked? if not then as the employer, you are potentially liable under Health and Safety legislation.
A good leasing company can help to manage all of these elements so that the costs are properly mitigated along with the health and safety risk, as well as helping to reduce vehicle downtime by ensuring a replacement is available if the car or van is off the road for whatever reason.
We get a better deal from a local supplier.
The cost of a vehicle isn’t just what you pay upfront or even the cost of the monthly payments. That’s why most large companies focus on the whole life cost of owning the vehicle. This includes depreciation, tax, maintenance, servicing and repair among other factors. Comparing the whole life cost and the upfront cost can be surprising which is why professional leasing providers will offer advice on the whole life cost of all cars and vans and you might be surprised by the results.
Arval buys in the region of 30,000 vehicles per annum on behalf of its customers, so is able to get good prices and can also supply any type of car or van currently available in the UK market. Arval also gets a lot of special offer vehicles because of its close relationships with the manufacturers which may mean you can afford a better vehicle that you might think.
Leasing is an option for all companies. It frees up cash and saves companies money both through upfront discounts, reduced operating costs and by reducing admin. There are several tax benefits especially in terms of VAT. Fixed monthly costs keep budgeting simple and reduce risk. It will also come with 24/7 support for drivers so they are always able to contact someone if there is a problem. Does that sound almost too good to be true? Well give Arval a call and find out for yourself