HaaS gives you access to the latest hardware, accompanying software, maintenance, installation, and insurance. All this for a fixed monthly fee. With a rental service, you no longer need to buy non-income generating assets that depreciate yearly. We offer a full commercial rental service that is not the typical hardware lease. HaaS will improve your financial gearing, cash flow and allows you to invest your capital into income-generating assets such as inventory. We believe that this is a great way to keep current with rapidly evolving hardware innovations, while still controlling costs and improving your balance sheet.
The question for many organisations is whether to lease or buy hardware, especially the “non-income generating assets”. This includes everything from computers and printers to firewalls and vehicles.
Consider the following downsides to owning non-income generating and depreciable assets:
- Not being able to commit your capital towards assets that generate a direct income for your business;
- Downtime resulting in loss of productivity due to maintenance or repairs;
- Reduced productivity, increased downtime and loss of data due to outdated hardware.
It is our view that in your growing business unless a depreciating asset generates direct income, you should rent it for the following reasons:
- Improved gearing: No more long-term liabilities on the balance sheet due to financing of non-income generating assets – improving your financial gearing and making your business more attractive to potential financiers and/or investors.
- Alternative financing option: If you’re a start-up or entrepreneur and you don’t have surplus cash or access to finance.
- Insurance included: No extra cost to insure your rental hardware.
- Cash flow benefits: Getting access to use an asset without having the initial capital layout.
- Tax benefit: Renting gives you the ability to claim as much as 43% back in taxes on your annual cash flow (15% for VAT and 28% income tax if you are a company).
- Reduced downtime: Stand by replacement units allow you to continue business while we deal with the repairs.
- Support benefit: Our rental units come with dedicated support services.
- Income-generating benefits: And last, but not least is the benefit of having more capital to access funding to invest in income-generating assets which will allow you to grow your business, not your asset register.
Contact us to find out how we can help free up cash to grow your business!
Hannes van Merwe (Hannes@grovation.co.za) or Sarel Visser (sarel@grovation.co.za).
