The Big Debate- For Business Owners

Should You Finance or Purchase with Cash?

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As a business owner, you want nothing more than to catapult your business into success. That is why it is of critical importance to invest your money wisely. One of the questions we get asked, as a finance broker, is how businesses can do just that! More specifically, whether purchasing assets outright or whether financing the assets makes the most financial sense… This is the big debate.

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Below, we stated points on either side so that you have the tools to make the right decision.

Purchasing with cash:

  • Purchasing outright may seem like the best option from the offset- and that is understandable! For instance, you get to own the asset without incurring an interest rate. This means that in the long run you end up saving money instead of paying over the RRP.
  • You will also have ‘peace of mind’ as you are exempt from monthly payments, saving you the worry if at one point in time you cannot afford the payment.
  • Owning the asset directly contributes to the overall value of your business


However, after having invested the majority of your capital into assets, what would you do if something were to go wrong- for example, if a system breaks, an asset fails, or you receive a significant VAT bill with demands from HMRC. Just how long would you have to wait for your cashflow to be replenished before investing in other areas of your business?

Whilst purchasing outright may seem preferable, it is important as a business that you prioritize your cashflow, leaving space for a contingency if unexpected costs arise.


Why should you choose to finance?

  • Financing supports you in making smart business decisions. For instance, if you are a start up business a commercial loan may help you to conserve your cashflow whilst investing in multiple areas of your business-helping to get your businesses feet off the ground.
  • Having a working capital equates to having financial health. Agreeing to a finance arrangement means that cash is readily available to facilitate the running of your business, support your growth ambitions enabling you to keep up with demand- in turn generating revenue.  An example, if a business was generating a 6% profit margin, it would be beneficial to retain the capital through the financing of critical equipment. This will help you to invest in staff and your growth ambitions- highlighting how the reduction of an upfront cost will support business growth through cashflow.
  • Aforementioned, finance packages allow you to have a safety net of funds just in case the unexpected crops up. Having the means to stabilize your business and to maintain a high level of productivity is vital for when a situation occurs.
  • Finance doesn’t just have to be a linear process of making a new asset affordable either… Finance can be utilized in ways to make use of what you already own. Refinance has the ability to release capital from assets you have purchased, so you can go on with upgrading machinery to execute your business plans.


Chatsbrook understand that even as a business owner, the prospect of finance is very personal. That is why we assess your business on what IS affordable for you, your trading periods and your requirement of the repayment period.

What Chatsbrook create is a perfectly tailored finance arrangement to suit you and your needs.

You can trust us to make your aspirations come alive.

Why not contact our friendly team on 01603 733500?


Share your ambitions and see your business thrive.

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