YOUR COMPANY IS LOOKING FOR ‘INFORMATION TECHNOLOGY ‘ FINANCING!
EQUIPMENT AND 'IT' TECHNOLOGY FINANCIAL SERVICES FOR BUSINESS
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Financing & Cash flow are the biggest issues facing business today
ARE YOU UNAWARE OR DISSATISFIED WITH YOUR CURRENT BUSINESS FINANCING OPTIONS?
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South Sheridan Executive Centre
2910 South Sheridan Way
Oakville, Ontario
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Financing information technology becomes a lot easier when the business owner/financing manager or information tech manager understands key issues and financing options.
Some areas of financing lend themselves perfectly to computer finance/ software financing - others... well let's just say ' not so well! Knowing the differences can make or break your tech budgets, and hopefully not your career! The advantages of using technology in the delivery of your products and services are key these days.. so I T loans and information technology business financing .. Let's dig in!
WHAT IS INFORMATION TECHNOLOGY FINANCING
Information technology financing, also known as ' I T ' financing allows companies to obtain capital needed to run and grow companies based on their computer hardware and software and related services needs.
I T solutions for small businesses can be a huge drain on business capital.
THE DEMANDS TO ACQUIRE TECHNOLOGY ARE CONSTANT FOR CANADIAN BUSINESS
While no industry moves more quickly than tech even it surprises us sometimes and moves even faster as the role of financing information and financial data is so key to being competitive. Just when you thought you knew all your options in hardware and software selection, as well as financing, along comes things like ' Cloud Computing '. (Real-time computing over a network with scalable virtual servers and software from a remote location)
Top experts in information technology tell us that fintech companies in the United States and Canada are massive users of technology. ' Fintech' is the ability of companies to integrate software into offerings of financial services for effective use and delivery of service offerings. Fintech has disrupted traditional information delivery in many segments in offerings of wealth mgmt and commercial and consumer lending, insurance, etc.
EQUIPMENT LEASING IS ONE METHOD OF SCALABILITY AND CHANGE IN YOUR TECH ASSETS
That whole issue of scalability, i.e. computing power when you need it and financing for that, has always been an issue. Traditionally it's been handled quite well thank you by using equipment lease financing to address the constant change in hardware and software needs and the actual evolution of those products and services in new versions, etc.
BUSINESS OWNERS CAN UTILIZE ' LEASE TO OWN' OR 'LEASE TO USE ' STRATEGIES
Typically owners would choose a ' capital ' or ‘operating’ lease to match their ownership needs. The danger with a capital lease not arranged well is that it locked the business owner/CIO into a long term arrangement that often very quickly needed upgrading. So penalties to break the lease were often expensive in the context of the total cost of ownership as companies found themselves locked into hardware and software that needed upgrading.
WHY AN OPERATING LEASE FOR TECHNOLOGY
Good financial analysis tools will help you understand most acquisition needs in acquiring hardware and software for your company. Enter the ‘Operating lease’ which allowed thousands of firms, large and small to enter into computer leases that seemed to make a lot more sense. Why? Simply because they gave the company the option to buy, return, upgrade, or extend the current computer financing arrangement. That added a load of flexibility to the owner/CIO's tech challenges.
Top experts in the industry tell us that today the ' Accelerated pace of implementation ' is in fact... you guessed it... accelerating!
FINANCING YOUR HARDWARE AND SOFTWARE NEEDS WITHIN BUDGETS AND CAPITAL CONSTRAINTS
Larger companies have the benefit of putting large budgets and people assets in place to do major implementations. The business owner in the SME sector is more challenged as they struggle to pick the right hardware and software and not eat into their cash flow and R&D budgets,
UTILIZE SR&ED FINANCING IN YOUR R&D CAPITAL PROJECTS
Clients in the past who used technology in their R&D and required computing power to perform that R&D could also claim those expenses as part of their SR&ED claim, which was also financeable when filed by the way, Yet that part of the SRED program is in fact being phased out, again making technology financing more of a challenge for Canadian firms who wish to innovate.
BENEFITS OF COMPUTER FINANCING
Naturally, the goal of any computer financing strategy is to lower costs, ease cash outflow, conserve working capital, and attain the benefits of the solutions in business decision making. Your ability to produce financial reports and manage financial transactions in your business is key to staying ahead of the competition. So having finance flexibility is key, and computer lease financing for hardware and software requirements still makes total sense. (When you have the right lease and lease company in place!)...
EVEN CANADIAN BANKS UTILIZE LEASE FINANCING FOR COMPUTERS AND SOFTWARE
Can we provide a good example of why computer leasing works and is used? You knew we could! Although probably not widely known all of Canada’s banks lease computers and software. What??!! Yes, it's true, so we have banks who only lend and guard our money actually borrowing money to finance their tech infrastructure.
Why would financial institutions such as a bank borrow money and incur interest and finance costs and lease obligations when in fact they appear to have all the money in the world?! The answer is what we have shared all along here, namely that it's not about the capital cost in an ever-changing technology world, it's about the flexibility to make changes in your tech assets such as hardware and software with maximum flexibility - allowing the banks ( or your firm ) to replace, upgrade, return, renew. All the while allowing you to... yes... stop chasing change!
CONCLUSION
All kinds of technology and financial information solutions can be financed in today's world of tech - that includes computers, servers, laptops, storage, phone systems and of course application software. It's important to know that almost every solution can be ' bundled' to include related services such as maintenance, licences, etc. It's no secret that the global IT market is in the trillions of dollars!
Major new trends have developed in recent years, most notably cloud based technology information and computing as an example. This requires additional security software for small and large businesses alike. Every vendor continually brings out new generations of technology, putting a strain on the capital budgets of every company, large and small.
By using effective technology financing strategies even smaller companies can compete more effectively in their industry/marketplace. The competitive demand to stay on top of change, as well as funding day to day requirements of your business, are intense.
Successful businesses know that working management is a key part of investing in new tech assets, The ability to upgrade assets and stay within capital budgets is top of mind for every business owner/financial manager. Financing options allow your firm to stay one step ahead of the competition in marketing your products and services.
The majority of technology asset acquisition in business today revolves around a necessity, not a ' nice to have - so it is essential to ensure your firm is moving lockstep with your tech needs.
The importance of information technology can't be underestimated by Canadian business owners in today's competitive environment. Big data, Blockchain investments, and digital finance transformation in corporate finance are top of mind for many information technology executives.
Whether you are in the financial industry or virtually any segment of the Canadian economy the role of information technology is critical in every business in Canada these days. The benefit of technology and the technological innovation in business will always keep your firm moving forward.
If you want to understand your technology financing options seek out and speak to 7 Park Avenue Financial, a trusted, credible and experienced Canadian business financing advisor and finance consultant with a track record of success in computer financing and helping you make finance decisions and understanding decision criteria. Let our team help you untangle financial pressures and technology.
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Stan Prokop
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