Investing in new equipment is a crucial step in growing your small business. Whether it’s a machine that can help you produce goods faster or storage solutions that prolong the shelf life of perishables and keep supplies organized, acquiring new equipment comes with a promise of increased productivity and reduced waste, as well as the capability to deliver better products or services to your customers.
That being said, purchasing equipment is a decision that requires careful planning beforehand. After all, it’s an investment that will take a significant amount from your limited capital as a small business. With that in mind, here are some tips to keep in mind when purchasing new equipment:
1. Evaluate Your Finances
Cash flow can be tight for many small businesses, particularly ones that haven’t been around for too long. As such, the first step you should take when buying new equipment is to first evaluate your business’s financial situation. Do you have the additional capital to purchase the equipment or are your current profits just enough to keep operations afloat at the moment? If it’s the latter, then you may consider trying out other financing options.
For instance, you can opt to take out a line of credit from a business loan Philippines lender. Most traditional banks offer SME loans, although they may be stricter with their requirements. If you want a hassle-free process and quicker approvals, you may want to consider digital banks. For instance, Maya Business has Maya Flexi Loan, which offers funding up to PHP 2 million. Once your application is approved, the loan proceeds will be deposited directly to your Maya Business Deposit. Maya’s borrower-friendly fees ensure that your monthly loan payments won’t be too hard on the pocket, thus helping your business purchase new equipment without making too much of a dent on your capital.
2. Assess the Value the Equipment Will Bring
Before you commit to buying a particular piece of equipment, make sure that you know the value it will bring to your business. This means conducting a thorough assessment, pinpointing the gap in your business that you’re hoping this equipment will fill, and then finding the right specifications or model of it that will do the job effectively.
Imagine you’re running a custom t-shirt printing business. As more orders come in, you may realize that your current printer can’t keep up with the demand anymore. The most apparent solution is to get a new printer. However, don’t just buy a bigger, fancier model with the blind assumption that it’ll do a better job. Rather, do your research about other types of printers first. Maybe what you need is a different printer altogether, such as a direct-to-garment (DTG) printer to replace an old heat press.
This assessment should also include how you see this equipment benefitting your business in the long run. Will it increase your production, thus yielding higher returns on your investment? Will the equipment help you stay ahead of competitors? Is the new equipment going to be easier to maintain? Asking these questions can help solidify your choice of equipment, ensuring that you’re buying it for the right reasons.
3. Look for a Trustworthy Supplier
Once you’ve decided which equipment to buy, remember to take your time looking around for suppliers before committing to a purchase. Fortunately, the internet allows you to browse through multiple supplier listings and compare prices in just a few clicks. Read up on what industry experts are recommending as well.
Do keep in mind that cheaper isn’t always better. Your priority should always be to find equipment that can do the job efficiently and do so in a long time. Hence, don’t be afraid to shell out a bit more for a pricier model if you can get the assurance that it will last you longer.
4. Keep Safety in Mind
As a business owner, you’d certainly want to create a safe working environment for yourself and your staff. Hence, consider safety features as well when choosing a new equipment. Make sure that the suppliers you’re buying from are certified manufacturers or distributors and that their products meet certain quality standards. This lessens the risk of equipment malfunctions, which, in turn, minimizes disruptions of your operations and safety hazards.
5. Don’t Forget Training
Last but not least, keep training in mind as you choose which equipment to buy. Something that is complicated to operate will require extensive training for your staff, so be prepared to allot the time and resources for it. After all, no matter how advanced your new equipment is, productivity will still drop if employees are having a hard time using it. To that end, you may also just choose equipment that is more user-friendly or a model that’s close to what your staff is already familiar with to minimize downtime.
Buying new equipment can certainly open up new opportunities for your small business. Still, it’s important to plan ahead and set clear goals beforehand to ensure the equipment you’ll be buying is the best fit for your business’s needs.
Article received on email
