By: Viraj Shah
Purchasing the right vehicle, whether a car, truck, or van, can be a wise investment for your business. It could help you save on shipping, delivery, rental, or travel costs.
But it’s an expensive purchase and a big commitment. It’s essential to do your car research before purchasing so you can make the right decision for your company. Here are seven things to research when purchasing a new business vehicle.
Size and Type
While you might prefer a nice-looking vehicle, it’s not all about aesthetics when buying one for your company. It’s more important to carefully consider the size and type you need before spending any money. The size and type of vehicle that’s right for your business will be determined by the trips you’re planning to make with it. If you’re sending your sales team out to meet with clients, you wouldn’t need a pick-up truck, and if you run a landscaping company, a sedan won’t get the job done.
Budget
Your company’s budget will also determine what vehicle you buy. How much of a down payment are you able to put down and how much can your company afford in monthly payments? Do you plan to make the purchase outright or take out a loan? And there’s more to think about than the money you’re putting down and monthly payments. You should also consider ongoing vehicle maintenance fees for the makes and models you’re considering, as well as insurance premium rates.
Used vs. New
While there’s an allure to new vehicles, buying a used car or truck might make more sense for your business. A new car will wind up costing you more than a pre-owned vehicle. Newer cars also tend to cost buyers more in taxes. Insurance for older vehicles is also usually more affordable.
Fuel Economy
Whether your employees are traveling long distances, you’re hauling heavy equipment, or you’re working as a rideshare driver, fuel costs can add up quickly. If you want to save money on gas, consider fuel-efficient vehicles. Lighter commercial cars also tend to use less gas. You might also want to check out electric or hybrid vehicles as an option.
Leasing Options
For some businesses, leasing a vehicle might be the better option. With a lease, you’re likely to have a lower monthly payment and can upgrade your vehicle once the lease is up. But you won’t outright own the vehicle and if you go over the mileage allowed by your lease, you’ll owe overage charges.
Tax Write-Offs
There are several tax write-offs available to businesses that purchase a vehicle. Section 179 helps offset part or all of the purchase of vehicles that are used for business purposes more than 50 percent of the time. This deduction can only be taken in the year the purchase is made. There are other possible deductions, including for mileage.
Branding
Your vehicle can be an excellent tool for promoting your business. Consider how easy it will be to put custom decals, such as your logo, or an eye-catching wrap on the vehicle you purchase.
Published by: Martin De Juan
