Sources of Finance

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For this task I will be considering the sources of finance I will need for my company.

Why might a business require finance?
A business may require finance because they can either:
• Be setting up a new business and they do not have enough money to start up.
• They may need new equipment to help make the business expand and make more profit.
• Or they may even want to replace old machinery.
• They may want to move there store to a better location that might benefit there company more.
• Or they may want to take over another company.
Additional finance can help a company keep trading while it is waiting for it payments for its last sales. It allows a business to meet ongoing costs of operation or help them to
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After a fixed time or period it will be sent back to it original owner. This method of finance is good my business because it is a car rental company and this type of finance is made for these sorts of companies. Not only can I lease my products but I can lease my premises as well. Leasing is an alternative to buying money assets. As we all no buying these types of merchandise can be very expensive especially for a new business like my self. Leasing helps new firms with there cash flow. I can find this source by researching leasing companies. There are two type of leasing methods:
Direct lease- A company chooses an asset it want to require form an leasing company and the leasing company rents it to you business for a period of time and eventually you will have to return it back to the leasing company after customers use it. Sometime the leasing company will allow the business to buy the asset for a good price.
Leaseback- this is like the opposite of direct lease. Your company own as an asset and leases it to and leasing company and the company leases it to you. The leasing company now owns that asset.
The drawbacks of leasing a car are:
• you can 't use a leased asset as collateral for a future loan,
• interest rates can be very high (so be sure to negotiate it before committing),
• some lease terms are longer than the life expectancy of the asset, so make sure that you don 't get stuck making payments on obsolete equipment,
• one

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