The impact of economic uncertainty extends far beyond figures. The psychological effect of uncertain times on business leaders is significant. And while caution is healthy, allowing it to lead to stagnation is dangerous. As we’ll detail, asset finance is an effective tool for controlled, staged investment during economic slowdowns.

In our 35 years as Shire Leasing, we have seen the business community go through good times and bad. Throughout, we’ve been alongside them, helping them access the latest technology and equipment so that they can grow.

Scale your business no matter the economic conditions. Get in touch with Shire today.

Why Pausing Investment Can Harm Long-term Growth

Often, businesses will look to hit the panic button during slowdowns, sacrificing investment for the short-term benefit of getting through macroeconomic tides. Unfortunately, pausing investment in assets, research, and essential upgrades does nothing but limit a business's competitiveness in the long term.

Across many industries, nimble start-ups with large capital investment arrive and disrupt the sector, offering more innovative services because they’ve leveraged new technologies. This leaves those established businesses that paused investment scrambling to keep up with these attractive new upstarts. Economic uncertainties are rightly viewed as negative.

In our experience, however, we have seen these periods as opportunities for businesses to access assets or investments on more favourable terms. Those who invest while facing headwinds will be in a far stronger position.

Smart Investment vs. Risky Spending

There is a difference between reckless spending and smart, calculated investment. Asset finance is a prime example of such a calculation, its very make-up is designed to be controlled and centres around affordable, pre-agreed monthly payments which can be included in a business’s regular outgoings. In return for these payments, you get access to the latest machinery, equipment, or tech that can help a business grow.

Asset finance offers short-term and long-term benefits, no matter what the economic picture is. Businesses can begin using the latest equipment days or weeks after their application was accepted, thanks to lightning-fast automation technology.

In the long run, finance payments are predictable and also come with opportunities to upgrade assets, ensuring you’re always using the most cutting-edge equipment in your sector. Financing is a far more calculated form of investment that provides a more definitive ROI.

How Asset Finance Supports Cautious, Staged Investment

We’ve discussed the strategic advantage of asset finance as an investment decision, but what are the key features that make it such a smart choice?

Cost is spread over time

The best equipment comes at a premium and a price that businesses, both old and new, can ill afford, especially when you factor in cash flow and other expenses. Asset finance bridges this gap between businesses wanting equipment and being able to afford it by allowing them to access it via affordable monthly payments spread across several months.

Repayments can align with your revenue

Using asset finance allows you to align the outgoing payments with the income generated from your business and the new assets. The repayments can be treated like expenses along with utilities and wages, and because of their predictability (payments don't increase or decrease unexpectedly), budgets can be calculated accordingly.

Keep your cash flowing

Purchasing expensive equipment outright causes huge dents in your cash flow, preventing you from investing in marketing, hiring, or R&D. Asset finance removes this problem and ensures cash can continue to flow in and out of your business as normal, all while you continue to benefit from the equipment.

Three real-world use cases during market uncertainty

Smart investment through asset finance has seen several businesses bloom during market uncertainty.

1. Firms in construction are facing pressures to meet green targets to ensure they’re more environmentally conscious. To achieve this, new, more efficient equipment is needed to replace outdated assets. Rather than investing precious capital in these new assets, leasing has allowed them to meet targets and benefit from better equipment quickly.
   
   
2. The rise of AI has forced tech companies to pivot quickly and invest in software that allows them to leverage the benefits of artificial intelligence and retain that competitive advantage. This kind of software requires a comprehensive installation done by experts who know how to maximise its features. Leasing new software and hardware can be done quickly and reduce the risk of investing capital, freeing up cash reserves to be spent on hiring the best AI talent.
   
   
3. For those in logistics, pressures, both economic and governmental, present them with challenges to upgrade fleets to meet emissions goals. Not only is the purchase of multiple vehicles expensive, but it is also time-consuming and requires input from people who know what to purchase. Leasing allows for access to environmentally friendly fleets from finance firms that have strong relationships with the best suppliers.

Shire’s Role in Enabling Opportunity, Not Just Survival

At our core, we’re about helping businesses seize opportunity no matter the state of the economy. Our agreements are built around flexible terms which are tailored to your business, and because the asset is used as the security, we can work with SMEs who haven’t had time to build up a long credit history.

We have approval technology that can provide finance decisions in 6 seconds or less, so you never miss out on momentary opportunities. Current customers can also get in touch with our team to discuss new arrangements or scaling existing ones at a moment’s notice.

With 35 years of experience, we have funded businesses across several sectors and built long-term relationships with leading suppliers. When combined, our team can offer smarter funding support and draw on our years of experience to give you the best arrangement.

Final thought: Slowdowns are also chances to future-proof

Continued investment during slowdowns is an opportunity for businesses to become more resilient, allowing them to embrace seismic changes in their industry. As economic conditions improve, it's the businesses that have invested now that will prevail. With the right finance partner, your company can access the latest assets that will unlock scalable growth.

Discover how Shire can help future-proof your business with affordable asset finance agreements.