Yes, it's mid-year already. Hard to believe as the speed at which the unprecedented events of 2020 have rolled out has made it a challenge just to keep up with everything. Keep up with the continual announcements around COVID-19 restrictions being placed and now being lifted. Keep up with the, gratefully, ongoing announcements of support programs and relief measures from both State and Federal Governments and have the time to review and apply. All this while keeping up with running your own business in very challenging conditions.
Many businesses were still dealing with the bushfires and then the major rain events when the coronavirus emerged with its own unique set of challenges. It’s likely you may have missed some of the opportunities and updates so we’re providing a quick wrap of key topics around lending especially to assist with your equipment investment decisions.
A mid-year update would normally be framed within the policies of the annual Federal Budget which would have been brought down in May. But due to coronavirus, the Treasurer has pushed that back to October.
Meanwhile, as the economy is in recovery phase we focus on both sides of the outlook:
- The bad: recession, high unemployment, risk of a coronavirus second wave
- The good: low interest rates, rising consumer confidence, Government support for key sectors including infrastructure projects and manufacturing, easing lender restrictions.
Supporting Your Business
- Throughout the coronavirus crisis, both State and Federal Governments rolled out numerous support packages and measures. Many are still available and extend for some time and more announcements are expected with targeted support for some sectors.
- JobKeeper was key to the Federal Government’s support package and as its expiry date of 30 September approaches, many businesses are waiting to see if it will be extended.
- The Instant Asset Write Off (IAWO) measure has utilised by many businesses to invest in a range of equipment. But due to forced closures, many also missed out by not being in a position to acquire, install, commission and have equipment operational by the original 30 June deadline. That deadline has now been extended to 31 December 2020. Could be good timing for your equipment investment plans.
- Talk to your accountant as to whether your business is eligible and what type of finance product works best for your business and get in touch with Jade Equipment Finance for a quote on financing equipment.
- A number of industry sectors have been singled out for special attention by way of support, to drive the economy’s recovery. If you operate in construction and building, infrastructure or manufacturing there could be new business opportunities available and support measures to capture.
- Some manufacturers pivoted to the production of alternative products during the crisis and now could be the time to review if that is a sustainable new market and hence worthy of further expansion with additional equipment.
Snapshot of the Economy
While the commentators talk recession and how long and how deep in the wider economic terms and framework, astute operators will be focussing on their own businesses and looking for opportunities to capture.
Here’s a selection of aspects for consideration:-
- The Reserve Banks’s quantitative easing, aka money printing, measure announced early in the COVID-19 crisis, was designed to allow lenders access to cheaper funds to facilitate lending and drive investment.
- Interest rates are low and the RBA Governor has indicated that he does not intend to take rates into negative territory. So now is a good time for businesses to set up equipment finance deals.
- Unemployment is high but on the flip side, consumer confidence rose in May after significant falls in March and April.
- The Federal Government has signalled support for Australian manufacturing on several occasions. While we don’t have specific programs to mention, there is a marked shift in interest in growing Australia’s capabilities.
- Businesses requiring heavy equipment, i.e. construction and infrastructure projects, should be seeing opportunities emerge for new work. Could be time to prepare to take on new contracts with new equipment so consider speaking with our Jade brokers.
Equipment Finance Recap
Jade has continued to support our customers at all stages of the crisis and with restrictions eased, interest rates low and business equipment investment being encouraged on several fronts, we are well-placed to deliver cost-effective finance deals.
Manufacturing presents opportunities for metalwork and engineering workshops and possibly the need to invest in a range of equipment – lathes, plasma cutters, laser cutters, specialist waterjet cutters and more which have required business to finance manufacturing equipment.
Jade Equipment Finance can assist with a wide range of your business equipment requirements. We provide finance for the heavy duty equipment required for earthmoving, mining and construction through to precision engineering equipment and the sensitive devices and machines required by the medical profession.
We’ll be staying across the economic and business scene and will be bringing you specific updates each month.
To discuss your equipment acquisition requirements, contact Jade Equipment Finance 1300 000 003
DISCLAIMER: THIS INFORMATION HAS BEEN PROVIDED AS GENERAL MATERIAL FOR YOUR CONSIDERATION. INFORMATION IN REGARD TO GOVERNMENT POLICIES IS SOURCED FROM OFFICIAL AUSTRALIAN GOVERNMENT SOURCES. NO LIABILITY IS ACCEPTED FOR ERRORS IN PRESENTATION OR IN THE INTERPRETATION OF FACTS OR THE COMMENTARY AND ANALYSIS OF INFORMATION WHICH IS AVAILABLE IN THE PUBLIC DOMAIN. INDIVIDUALS ARE ADVISED TO CONSULT WITH THEIR FINANCIAL ADVISOR OR ACCOUNTANT FOR SPECIFIC ADVICE REGARDING THEIR INDIVIDUAL SITUATION.
