Despite the agricultural sector’s difficulties regularly faced, farmers try to produce significant crops on cultivable land. Either way, you need the right equipment to get the most out of your farm. However, acquiring such equipment cannot be improvised since it constitutes an expensive operation. A question then arises: how to finance its agricultural equipment? But still, should you buy new or used equipment?
Buying Used Agricultural Equipment: How to do it?
Farmers generally rely on second–hand equipment to equip themselves. It is a fact! Purchasing this type of equipment has many advantages: affordable prices and shorter delivery times. When avoiding unpleasant surprises in the future, it is essential not to neglect the acquisition used in agricultural equipment. In this perspective, different parameters must be considered, including:
- The extent of farming
- Equipment power and consumption
- Its reliability and robustness
- Frequency of use
- Ease of handling
Better still, it is vital to favor materials that meet their needs.
Regarding the acquisition itself, farmers can turn to advertisements of used agricultural equipment, which can be placed by:
- Another farmer who renews his machines
- An agricultural equipment dealer
- An independent body
- An agricultural cooperative
How do You Buy New Agricultural Equipment?
Even if new agricultural equipment is not popular with farmers, this option is still possible. Besides, those who wish to invest in new agricultural equipment can equip themselves with many professionals. In the first place, they have quite the possibility of going through a concessionaire for their acquisition. In addition to exclusively offering equipment from a reliable manufacturer, this player provides after-sales service. On the other hand, nothing prevents them from going directly to the branch of a particular manufacturer. Otherwise, they can always see from a specialized distribution chain.
In all cases, in order not to miss anything in the choice of your agricultural machine, it is crucial to consider specific essential criteria:
- Characteristics of the agricultural holding (area, type of land, etc.)
- Adapted power
- Ease of use
- Consumption
- Manufacturer’s warranty
- Interview
Finance Agricultural Equipment: Are you Thinking of Borrowing or Leasing?
Whether to buy new or used agricultural equipment, farmers’ budgets are not always sufficient for farmers who have just started their activity. To finance the acquisition of their equipment or the modernization of their equipment, they turn to borrowing or leasing.
Loans, a highly requested financing solution for the acquisition of agricultural equipment
Taking out a loan to finance the purchase of agricultural equipment is an approach highly recommended by farmers. It mainly allows them to preserve their cash flow. In addition, by applying for a conventional loan, farmers immediately become equipment owners.
In all cases, to contract a loan, the first reflex of farmers is to go through the banks. But today, they can also request financial support from another independent. Another possible option for applying for credit is agricultural equipment dealers. Indeed, some of these organizations offer financing through their credit institution.
If you want to benefit from the best financing solution, it is strongly considered to compare the current offers on the market. Having competition is often beneficial. However, farmers also can use the services of a professional finance broker to make their job easier.
Leasing, an attractive alternative to conventional credit
Instead of buying agricultural equipment, renting is also a solution for farmers. To do this, they must subscribe to a financial leasing offer. Also called leasing, leasing has its share of advantages:
- Have at your disposal adapted, functional, and modern agricultural equipment
- Do not provide a bond or personal guarantee
- Benefit from a tax benefit (rents fully deductible from the result)
- Allow the farmer to maintain his borrowing capacity
In addition, unlike conventional credit, leasing makes it possible to finance fixed assets at 100%. There is nothing better than to save your cash as much as possible. In addition, if the farmer wishes, he has the perfect opportunity to buy the agricultural equipment he has rented at the end of his contract. Leasing is, in principle, accompanied by a purchase option.
Note that some independent organizations have developed other solutions to finance the acquisition of agricultural equipment. Farmers can opt for financial leasing or lease–back to purchase their equipment.
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