Tanning Bed Financing Tips...
Tanning bed financing is available from most of the top tanning bed manufacturers, or indirectly from financing companies specializing in the tanning industry.
There are benefits to financing with a larger tanning bed manufacturer and there are sometimes drawbacks as well.
The benefits of leasing a tanning bed from the tanning bed company is that you may be able to get competitive financing as well as a little bit more wiggle room on tanning bed financing rates, discounts on additional tanning beds, and accessories like the much needed ventilation installation for big powerful beds. This is usually an extra cost, but if your tanning bed manufacturer has tanning bed technicians and maintenance crews, you can probably negotiate installation and maybe even a years worth of maintenance or extra tanning bed bulbs, or something else into the mix.
Also, the sales representative may be able to help push your tanning bed lease paperwork through underwriting faster, and get deals done faster than if you went with an outside financing company.
But sometimes you can get a better tanning bed financing rate and terms with an outside company. That's pretty much the only advantage to working with an outside financing company. And it's a good benefit if cash flow is your primary concern and you can do much of the installation of the tanning bed and venting systems...and maybe even the actual electrical work (electrical is a big deal and requires an electrician which can be very expensive).
If you go with a smaller manufacturer you will probably have to deal with an outside or recommended tanning bed financing company and you may not be able to negotiate additional services or accessories.
One example I can give you is that we were able to get a used tanning bed financed through our tanning bed vendor because we had a good relationship and it only had 50 hours at most on it. This would not have been done with an outside tanning bed financing company, or it would have been very difficult. And this was right as the recession was starting to hit stride.
Also, tanning bed financing companies who are outside of a tanning bed manufacturing company can become cold and hard to work with in an instant. But if you have a good relationship with a vendor and use their in house financing company this is unlikely to happen or you can get your sales representative to do some of the work for you in terms of dealing with the financing company.
If you have never worked with or negotiated with a tanning bed financing company, it can be very frustrating, especially now. It's a good idea to work closely with a tanning bed manufacturer if at all possible. They can be a very good resource when it comes to financing tanning beds.
Tanning Bed Financing Tips:
Make sure you own your tanning beds at the end of the lease or at least have the option of owning them with a pay off at the end of the lease. Negotiate the pay off amount. For example, if you get a five year lease and at the end of the lease you do not own your tanning beds, you don't have an asset to sell or count toward your business if you want to sell your business (ask you accountant for specifics on this. I am not an accountant). Plus you won't have any beds!
Read your paperwork carefully and be sure any gray areas are addressed. Leasing companies are clever, so be sure you are in control of the negotiations and you are comfortable with the deal you make. Never sign anything until you are comfortable with the terms.
As with most leases, you can lower the payments if you extend the lease. This can be an advantage if you are on a budget. But it's always better to get a shorter lease with payments you are comfortable with so that you can increase your cash flow at the end of the lease. Also, technology changes and competitors may move into your area. So if you need to be more competitive with new tanning beds and you are stuck in a long lease, this can be a problem.
Some business owners claim that you should never finance anything. Just pay cash. There are many advantages to this. But if you negotiate your terms well, you may want to finance instead of paying cash.
Use a spread sheet and weigh the options. You may be surprised that financing is a better option than paying cash.