Changes within a business operation, or from external factors in the markets served can result in existing machinery no longer being fully suited to the purpose, product or the project. Putting operators in a position to consider replacing the unit with a more suitable model. But is replacing the asset the only option? Depending on the specific unit, there may be a more affordable, workable alternative by repurposing the unit with modifications, attachments and system upgrades. A range of cost-effective equipment finance products are available through Jade Finance to enable business owners to repurpose rather than replace key machinery.
The types of modifications that may be financed include the purchase of attachments, tech systems and accessories to adapt tractors, loaders and agricultural machines to suit different crops. Acquiring new buckets, couplers and similar for dozers, graders and other construction, forestry and mining sector machines. Leading brands of construction and agricultural machinery include Caterpillar, JD, Case and other provide an extensive selection of attachments for many of their machines.
Where a new range of products requires the production process to be adapted, the requirements may include special parts and/or new digital operating systems. Businesses relying on computer systems may regularly need to adapt their software. Business owners looking to move into new markets to take on other types of projects may need to adapt their assets accordingly.
Many business owners may simply be seeking to improve productivity and efficiency without having to invest in new machines. We provide an overview of the loans available for modifications to allow operators to compare with financing new equipment to assist their decision-making.
Repurposing Machines with Equipment Finance
Buckets, stump grinders, tractor attachments, accessories and other major parts that are considered to be acceptable as collateral, may be financed with asset acquisition credit facilities. These include Chattel Mortgage, Rent-to-Own, Leasing and Hire Purchase. As secured format loans, these facilities offer cost-effective solutions with affordable rates and flexible terms available. Payments may be structured in line with the life cycle of either the main unit or the newly installed extra.
Modifications which require software packs, tech kits, and some parts and components, may be suited to financing with non-asset credit facilities including unsecured and secured business loans. These types of loans can be used for a broad range of business expenditure. Secured loans may use other assets of the company as collateral. Where no security by way of assets is available, an unsecured format loan may suit the purchase. Unsecured loans do attract higher rates than secured loans.
The versatility of general business loans allows for extra expenses included in the modification process, such as labour, installation and commissioning costs, to be financed. Easing pressure on existing cash flow funds and potentially presenting a very workable and viable option to achieving the business objective.
Where lower cost modifications are required, business may also consider an overdraft. Rates on overdraft finance are higher compared with secured loans. But the flexibility they present, may present the ideal solution to quickly modifying existing machines to new purposes.
If the modifications require multiple parts and systems, it may be possible to secure one financing arrangement to include all the requirements. Providing operators with a more streamlined option with the one monthly repayment only.
There will be multiple variations in requirements for different machines and different businesses. Having an initial conversation with our experts can quickly clarify the most cost-effective solution for your specific requirements.
Comparing Equipment Acquisition and Modification Options
The decision as to which is the best way forward – buy a new machine or modify the existing, will be up to individual business owners. To assist with that decision, our Finance Calculator can be used to generate estimates on all the business loan options. Interest rates will vary based on individual business profiles. But our current rates may be used to obtain quick estimates for comparison purposes.
To estimate repayments on acquiring new machines, use the interest rate relevant to the choice of asset acquisition credit facility – Leasing, Chattel Mortgage, CHP or Rent-to-Own. If the intention would be to sell or trade-in the existing machine, deduct that amount from the loan total, if desired.
When estimating loans for attachments and other parts to modify existing equipment, use the price of the goods as the total required and the interest rate for the loan type required – Secured or Unsecured Business Loans, or Business Overdraft.
All amounts can be changed to work out different combinations with different terms, rates, balloons and totals. How do the numbers stack up for your business? Replace or repurpose? For quotes based on your specific purchases and profile, contact our brokers.
For quotes on cost-effective, workable equipment finance to modify and repurpose existing machinery, contact Jade Finance.
DISCLAIMER: NO LIABILITY IS ACCEPTED IF ERRORS OR MISREPRESENTATIONS ARE FOUND IN THIS ARTICLE. THE ARTICLE IS PREPARED AND PRESENTED FOR GENERAL INFORMATIVE PURPOSES AND IS NOT INTENDED TO BE THE SOLE SOURCE OF INFORMATION FOR MAKING FINANCIAL DECISIONS. THOSE REQUIRING GUIDANCE AND ADVICE SHOULD CONSULT A FINANCIAL ADVISOR.
" alt="">