A small business goes through different stages of growth. Some of the first ones are the move to a bigger premises, hiring the first full-time employee and, of course, the moment it becomes necessary to invest in a vehicle, or fleet of vehicles, for business purposes.
To guarantee the continued growth of the business, it’s important to make the right choice when it comes to buying said vehicle. Not giving enough thought to the type of vehicle that’s needed for the business could mean that a second purchase becomes necessary long before the cash is available.
The main considerations to keep in mind are purpose, fuel economy, price, resale value and future business needs. Let’s take a closer look at them all:
The intended purpose of the vehicle is arguably the biggest determining factor aside from price. Think about what you would transport on an average day. If the car will be used mainly for sales calls, a small hatchback would do the trick. If you’d need to transport equipment, a pick-up truck would be more suitable. A minivan would become necessary if the vehicle will be used to transport staff or clients on a regular basis.
Sales people spend a lot of time on the road. Should this be the business you’re in, you want to look at cars that are fuel efficient. You don’t want to spend a big chunk of the business’s budget on fuel every month. Gardening or home cleaning services require bigger vehicles that aren’t necessary fuel efficient, but then it becomes necessary to devise fuel-saving strategies. For example, it could be not overloading the vehicle or planning routes beforehand.
Nearly everyone would want a new car for their business, but purchasing a brand-new car might not be realistic. And no matter how much you want that new model, it’s vital to not overspend. So be very honest about your budget and if you can’t afford a new car, look into used cars for sale. It’s very possible to find a second-hand car that’s still in mint condition.
There will come a time when you’d need to sell the vehicle, so take the projected resale value into account too. Some vehicles retain their value better than others, so they’d be a better initial buy. You can do your own research on the internet to determine which vehicle these would be or talk to a car dealer you can trust.
Future business needs
Yes, you will eventually sell the vehicle as mentioned, but you’d want that day to be as far in the future as possible; especially if the business’s cash flow is still up and down. This is why it’s necessary to purchase a vehicle that’ll serve you well now and into the foreseeable future. Say you run a flower shop – don’t get the smallest pick-up truck on the market; get a medium-sized one to accommodate some business growth. Once the time comes to update to that big pick-up truck or minivan, your business will be in a great position to have vehicle and asset finance approved to purchase it.
Image credit: www.pixabay.com