Published October 25, 2016 | Updated February 24, 2021
There is a software assistant in your phone that answers your questions. Websites seem to read your mind from the minute you land on them. Some cars parallel park for you – or even drive you around. This is the kind of thing that might come to mind when people think of technology innovation.
But advances extend far beyond consumer technology. Commercial equipment and technology in all categories are constantly advancing. And the pandemic has accelerated these advances and the need for companies to acquire them just to be able to continue to stay competitive. But how do you continually equip your business for the everchanging needs your company is facing?
The first step? As part of your company’s strategic planning, you should develop an asset plan. What are the critical assets, equipment, technology, etc. that power your business? How long should you plan on keeping each asset before upgrading, replacing or rebuilding based on your planned usage? From there, think AFMD – Acquire, Finance, Manage, Dispose – as the core elements of strategy for each major technology your business depends on. It may take some real thought the first year, but by updating this approach every year, you have the beginnings of a long-term plan to keep up with technology. Now, how to afford it?
The financial demands of keeping pace with technology advances can be daunting. Just when you feel like you’ve completed a major investment in technology for your company, it’s time to upgrade, trade in, or replace. This leaves business owners with painful cash flow spikes and unpredictable operations. The lifecycle management plan might help you predict when those cash flow spikes may occur, but who wants cash flow spikes? The “F” in the AFMD life cycle plan – finance – may carry the most weight for your long-term success. When executed well, financing can help you:
- Reduce and even eliminate cash flow spikes
- Acquire equipment and technology with affordable monthly expenses
- Pay only for what you use of an asset, instead of paying for all of it
- Match expenses to revenues more easily
- Reduce the hassle of end-of-life trade-in or disposal issues
- Affordably stay on the cutting edge of technology
The pace of technology can be effectively managed. How you manage the lifecycles can even become a durable competitive advantage for your company.
We can help. At LEAF, we offer financing that allows you to get the most from your assets in the most affordable way. Do you need a plan? Let’s talk.