Interested in small leasing business ideas? If YES, here is how to open a leasing company with no money and no experience. How much does it cost to start up?
How to Start a Leasing Company
Are you looking to start a leasing company? A lease is a contract where a party agrees to rent properties (building, equipment, machinery, vehicle, parcel of land etc.) owned by him to a second party (lessee) usually with terms. This enables the lessee’s use of the asset and guarantees the lessor (owner) the regular lease payments from the lessee for an agreed number of months or years.
This works just like renting out your properties for a period of time to be used by another party on an agreed payment. This can be a very profitable business idea for you if you are well-equipped with practical knowledge about the business.
The market is already there as most startups can’t secure the fund to purchase most equipment to use for their work that they go for leasing till they can buy them. Your equipment/properties will end up serving so many companies for many years and will be bringing revenue for your company.
To start a leasing company, there are several strategic steps you should take to ensure a successful business venture.
CAR, EQUIPMENT, TRUCK, PROPERTY, TRAILER, CONTAINER, AUTO LEASING BUSINESS
Do Some Market Research
You don’t just start a leasing company without having knowledge of existing leasing companies in your locality. The first thing you should do is to first understand the market and how you can join the league and start making money.
Your research should include properties that are of high demand in your chosen niche and the price at which these existing leasing company are leasing theirs. This will enable you to know items that have strong demand in your area and give you a blueprint on how you develop your plans for your business.
Having done with your research, you should by now know the market that is highly competitive and the one that best suit your taste. You should choose your niche in respect to market demand and your existing contacts so you can easily start getting customers.
After you have decided on the niche you will venture into, you should also decide on what you will be leasing after you have started your leasing company.
Irrespective of the niche you choose, it requires huge capital to start a leasing company. This is a business that involves buying and leasing, you will need to buy original and long lasting equipment so you don’t run at a lost from many repairs.
So, it is very important that you first find out to know the cost of equipment you will be buying for your leasing company and ask yourself if you still want to go ahead. From your findings, you will be able to know if you will be funding the company yourself or inviting investors to help with funding.
Draw a Business Plan
This is very important when starting a leasing company especially if you plan to borrow money. Showing your bank or any financial institution a well-written business can impact the possibility of your loan request been considered and accepted.
Aside that, a leasing company business plan is more like a guide or blueprint of your mission and vision for your leasing company. A well-written business plan must include;
- An executive summary.
- Company Vision and Mission Statement
- Business structure
- Product and services
- Target market
- Sales and marketing strategy
- Sources of funds
- Starting and Operational cost.
If you don’t have any idea on how to go about writing a business plan, there are friendly business plan software online that you can make use of or you can use the service of a business consultant.
Register your Leasing Company
You must register your company if you want to start a leasing company. This is the only requirement to operate your business legally. The process of business registration is relatively easy as it does not require stress and too much documents.
To do this you just need to visit any Internal Revenue Service office in your city and go fill out the appropriate forms to get your business registered. You will be needing the service of an attorney to help facilitate the registration process irrespective of the form of business you are registering your business under.
You can also obtain business license which is also important from the same Internal Revenue Service office.
Secure a Trusted Supplier
You should take your time to secure a trusted supplier for your inventory. Also take your time to negotiate with various supplier to get the best offer so you can save some cash and make profit.
Have it in mind that buying in bulk will reduce the unit cost and help increase your profit margin. From your market research conducted, you should know how much inventory to purchase at the startup stage.
Promote your Leasing Company
Without promotion, nobody will know your business exist. To find clients and develop contracts, you will need to effectively market your leasing company. This will be very tough and will require that you have a budget for marketing and promotion.
You can run online promotion as it is cheaper and also effective as well. Running ads on newspaper and television should also be included in your promotion strategy.