rental and hire purchase are the two dominant forms of asset
finance. With latter (hire purchase) you get to own the asset,
while with a former (lease) you pay a rent for use. It has
been observed that lease has been more popular for ‘technology
assets’ like computers, while hire purchase dominates ‘hard
assets’ like plant and equipment.
this in mind, you need to assess which asset finance is best
for you. Apart from the two asset finance, there are two forms
of delivery - direct and vendor.
asset finance is when finance is arranged independently of
the asset supplier. Banks, specialist financiers and a wide
range of brokers offer direct hire purchase and lease agreements.
is offered as an alternative to ‘cash sale’ by
the supplier. There are circumstances and asset types particularly
suited to this type of finance. The vendor finance module highlights
these circumstances by assessing the relative features of the
direct and vendor approach. It does not, however, assess the
relative costs and a quote for direct finance is a useful benchmark
for assessing the cost/benefits of the vendor approach.