Regardless of the industry you operate in, chances are you are aware of the serious situation in regard to supply chains on a global basis. Throughout the 18+ months of the coronavirus pandemic, there have been noticeable issues in delay of stock in many areas – cars, trucks, equipment amongst others.
The situation was identified early in the pandemic in 2020 and most recently, consumers being warned to order early for Christmas so as not to be disappointed. Major retailers have reported having to place orders for stock 12 months ahead to ensure stock on shelves, which is totally unprecedented for the sector.
So what’s causing the problem, how long will it last, how could it impact your business and why should you acquire new equipment now? We have identified a number of key reasons as to how the global events can and are impacting local operators with machinery supply chain issues and why this could be a signal to expedite acquisitions.
The reasons behind the serious disruption to supply chains globally are actually multiple and multiplying. Computer chips, Suez Canal blockage, factory closures due to the pandemic, shipping delays and even a shortage of pallets are amongst some of the major reasons.
For some time a shortage of computer chips has held up and in some cases stopped production of many goods including equipment used in many sectors. Adding to the shortage of the key components required, manufacturers are also facing increased costs for materials, freight and energy. An emerging and urgent issue is in regard to shipping - soaring shipping costs, availability of space on container ships and congestion at the ports.
Securing the equipment now that you need and will need moving forward to keep your business operating and profitable may be a key priority.
Solid Reasoning to Expedite New Equipment Purchases
While global supply chain issues are of major concern to the supply of an ease of acquiring new equipment in some sectors, there are a raft of other reason to back a decision to bring forward purchase plans.
To ensure your business continues to operate at peak performance and productivity we present a number of key reasons to expedite the purchase of new machinery, plant and equipment:-
- To take advantage of new contracts. The infrastructure boom is continuing with many states issuing new contracts for major projects very recently. Increased investment in infrastructure was a major stimulus strategy for state governments and the projects continue to roll out. Well-equipped tenderers may be better-placed for success.
- The construction sector has bounced back strongly recently with activity in commercial, apartments and infrastructure posting good results in the most recent industry-released figures. Having a quality fleet of construction equipment ready to go can place contractors in an ideal position to capitalise on the opportunities available.
- Gain the competitive edge on the competition. While competitors may bypass the decision to upgrade, astute business owners can take the leading position by upgrading to the latest tech and more efficient machinery.
- To revive your business for restart after lockdown. Customers at gyms, beauty salons, retail and hospitality are finally returning after months of restrictions. What better way to welcome them back than with fresh, new equipment to revive their interest in your business operation.
- To be ready to adapt to changes to the way business operate in the post-pandemic economy. Those that are well-equipped may be better-placed to recover and thrive faster. Some COVID-related restrictions will be in place for some time and that may mean an investment in new business equipment.
- New, more efficient machinery may be a key to overcoming labour shortages. Labour and skills shortages have been identified in many sectors. Possibly pivoting to new equipment and machinery may be a solution to at least part of the problem for your business.
- To capture stock of the equipment required that is currently in showrooms and dealerships ready for delivery. Stock is low in some areas so acting fast could be advisable.
- Upgrade now to prevent costly breakdowns and repairs on existing machinery which could cause delays down the track.
Indirectly related to the supply issues is of course the current low interest rate scenario. As demand pushes up prices, inflation will subsequently rise and edge closer to the trigger point for the RBA to act on rates.
Finance for New Equipment
There may be supply issues in equipment, but fortunately these issues are not impacting the ability of Jade Equipment Finance to provide cheap interest rate equipment finance.
We can assist businesses to quickly upgrade equipment, plant and machinery:-
- Lock-in current cheap interest rate finance while rates are still at historic levels.
- Plan well ahead with our 7 year loan terms.
- Preserve cash funds with no deposit finance.
- Take advantage of accelerated asset depreciation measures including temporary full expensing.
- Pre-approved finance to confidently place an order.
Our finance products available for the purchase of a wide range of machinery, plant and equipment include:-
- Leasing
- Rent to Own
- Commercial Hire Purchase
- Chattel Mortgage
Global supply chain issues are forecast to continue for some time in some sectors. Capturing the equipment available in dealerships now, could put your business in a more favourable position to grow and thrive moving forward.
For cost-effective equipment finance, speak with a Jade Equipment Finance consultant. Contact us for a quote on 1300 000 003
DISCLAIMER: IF MISINTERPRETATIONS, MISREPRESENTATION OR ERRORS EXIST IN THIS ARTICLE, NO LIABILITY IS ACCEPTED. THE INFORMATION IS PROVIDED ONLY FOR GENERAL PURPOSES AND NOT IN ANY MANNER INTENDED AS THE ONLY SOURCE FOR MAKING FINANCIAL DECISIONS. THOSE THAT CONSIDER THEY REQUIRE ADDITIONAL GUIDANCE OR ADVICE SHOULD REFER TO AN INDEPENDENT FINANCIAL ADVISOR.
