Have you ever had a piece of equipment break down at the exact wrong moment? Have you ever kept an old piece of equipment “hoping” that it will keep on going a little longer as you don’t want to spend the money on a new one just yet?
Have you ever received promo about the latest and greatest equipment and drooled over it and longed for it, but felt it was out of reach financially?
How to Have What You Want
For sure, you could just run up another lease or line of credit and order as soon as you see something you want. But is that the right way to go about it? Do you REALLY need it right now?
The harder task with regards to equipment is how to have what you want BEFORE you need it but not to buy it too soon. You want to get as much use out of your current equipment as you can. There are lots of times when it is not something that you NEED to have right now. Equipment however does not have an expiry date on it, so you need a plan.
A Little Prediction Goes a Long Way
With any piece of equipment you own that is over $5,000 (for instance), you could find out from the manufacturer or distributor how long it is predicted to last based on the amount of use you give it and find out how much a new one would cost.
Next, figure out how many months are between now and the predicted date of demise of each piece of equipment. Divide those months into the cost of new ones.
The resulting amount is how much you need to set aside in a special Equipment Account each month so that when it comes time for a replacement, you have the money saved up. Chances are good if you do this that you will have a replacement piece before it becomes a matter of life and death (so to speak).
Saving up for the expense before you need the equipment is so more proactive than sinking further and further into debt. You also avoid interest charges.
Another key consideration is whether to buy cheap or buy good quality. The answer is often the second option as it will usually last longer and with less repairs and other problems. So short term pain for long term gain.
Plan ahead and save!
Would you like to take your practice up to a new level of production and income?
Call us to find out how we can help you do that:
416-466-6217 or click here