The Equipment Leasing Association (ELA) today released
the results of its seventh annual survey of the Small Business
Administration's (SBA) State Small Business Person of the Year winners
about their equipment financing methods and reasons for leasing
equipment. Of the 18 respondents from among 50 U.S. state winners, 95
percent have leased equipment for the operation of their businesses.
Eighty-four percent agree that leasing equipment is a good business
strategy for meeting the demands of small businesses. The top benefit
of leasing cited by respondents this year was the increased cash flow
enabled by leasing.
The State Small Business winners ELA surveys each year represent an outstanding small business recognized by the SBA in each of the 50 U.S. states. The winners are selected on their record of stability, growth in employment and sales, financial condition, innovation, response to adversity, and community service.
"The overwhelming majority of State Small Business winners using lease financing survey results bear out that equipment leasing continues to be a financing option of choice for well-run small businesses," said ELA President Michael Fleming. "It's interesting to see the top benefit of leasing the SBA Small Business winners select because it changes from year to year. It's a great illustration of the flexibility leasing provides."
Office equipment is the top equipment type leased, as it has been for the last five years, followed by computers and industrial/manufacturing equipment, both reported by 33 percent of respondents. Sixty-one percent of the respondents stated that economic and financial market conditions affect their financing option decisions for equipment acquisition, in contrast to 65 percent of last year's respondents who said that external conditions did not affect their financing decisions.
Other key findings:
-- Of respondents who lease, 65% lease less than 15% of their equipment assets, and 30% of respondents lease 15% to 45% of their equipment assets.
-- Increased cash flow was the top reported perceived benefit of equipment leasing with 50% of the respondents selecting this attribute. No down payment and maintenance options tied as the second highest perceived benefits with 39% of respondents noting each of these attributes.
-- When evaluating financing options for equipment procurement, bank loans are the number one competitor with 78% of survey participants considering this vehicle. Two-thirds (67%) consider a line of credit, followed by 61% evaluating cash purchase for equipment acquisition.
-- The percentage of respondents who currently lease (84%) increased over 2005's percentage of respondents who were leasing (70%), and was only slightly lower than in 2004 (86%).
-- From 2004 to 2006, the top most cited reasons businesses leases were consistent expenses for budget planning, increased cash flow, ability to have the latest equipment, and no down payment.
Members of the accredited media may obtain a copy of charts and graphs for publishing, by contacting Diane Johnson at 703-391-2056 or diane@fourleafpr.com.
For a copy of the survey topline report, visit http://www.elaonline.com/research/trends.cfm#SBA
For more information on ELA visit http://www.ELAOnline.com. For more information on leasing, check out ELA's informational portal for financial decision-makers at http://www.ChooseLeasing.org, which hosts a directory of leasing companies, a list of 10 questions to ask before signing a lease, a glossary of terms and more.
About ELA
Organized in 1961, the Equipment Leasing Association (ELA) is the premier non-profit association representing companies involved in the dynamic equipment leasing and finance industry to the business community, government and media. As the voice of the leasing industry, which is directly responsible for generating a minimum of three million jobs and $75 billion in GDP to the economy annually, ELA promotes the forecasted $220 billion industry as a major source of funds for capital investment in the United States and abroad. Headquartered in Arlington, VA, ELA has more than 750 member companies and a staff of 25 professionals. For more information on ELA, please visit www.ELAOnline.com.
The State Small Business winners ELA surveys each year represent an outstanding small business recognized by the SBA in each of the 50 U.S. states. The winners are selected on their record of stability, growth in employment and sales, financial condition, innovation, response to adversity, and community service.
"The overwhelming majority of State Small Business winners using lease financing survey results bear out that equipment leasing continues to be a financing option of choice for well-run small businesses," said ELA President Michael Fleming. "It's interesting to see the top benefit of leasing the SBA Small Business winners select because it changes from year to year. It's a great illustration of the flexibility leasing provides."
Office equipment is the top equipment type leased, as it has been for the last five years, followed by computers and industrial/manufacturing equipment, both reported by 33 percent of respondents. Sixty-one percent of the respondents stated that economic and financial market conditions affect their financing option decisions for equipment acquisition, in contrast to 65 percent of last year's respondents who said that external conditions did not affect their financing decisions.
Other key findings:
-- Of respondents who lease, 65% lease less than 15% of their equipment assets, and 30% of respondents lease 15% to 45% of their equipment assets.
-- Increased cash flow was the top reported perceived benefit of equipment leasing with 50% of the respondents selecting this attribute. No down payment and maintenance options tied as the second highest perceived benefits with 39% of respondents noting each of these attributes.
-- When evaluating financing options for equipment procurement, bank loans are the number one competitor with 78% of survey participants considering this vehicle. Two-thirds (67%) consider a line of credit, followed by 61% evaluating cash purchase for equipment acquisition.
-- The percentage of respondents who currently lease (84%) increased over 2005's percentage of respondents who were leasing (70%), and was only slightly lower than in 2004 (86%).
-- From 2004 to 2006, the top most cited reasons businesses leases were consistent expenses for budget planning, increased cash flow, ability to have the latest equipment, and no down payment.
Members of the accredited media may obtain a copy of charts and graphs for publishing, by contacting Diane Johnson at 703-391-2056 or diane@fourleafpr.com.
For a copy of the survey topline report, visit http://www.elaonline.com/research/trends.cfm#SBA
For more information on ELA visit http://www.ELAOnline.com. For more information on leasing, check out ELA's informational portal for financial decision-makers at http://www.ChooseLeasing.org, which hosts a directory of leasing companies, a list of 10 questions to ask before signing a lease, a glossary of terms and more.
About ELA
Organized in 1961, the Equipment Leasing Association (ELA) is the premier non-profit association representing companies involved in the dynamic equipment leasing and finance industry to the business community, government and media. As the voice of the leasing industry, which is directly responsible for generating a minimum of three million jobs and $75 billion in GDP to the economy annually, ELA promotes the forecasted $220 billion industry as a major source of funds for capital investment in the United States and abroad. Headquartered in Arlington, VA, ELA has more than 750 member companies and a staff of 25 professionals. For more information on ELA, please visit www.ELAOnline.com.
© 2006 Business Wire