Businesses ‘should opt for van leasing’

JonathanJanuary 12, 2012

Thousands of businesses rely on their vans to transport goods and resources across the length and breadth of the British Isles and for some the growing motoring costs may be becoming prohibitive.

A delivery company, or sole tradesman, needs to keep their vehicle up to date and in a good state of repair because the potential pitfalls of having the vehicles off road for a sustained period of time are dire.

Van leasing may be the ideal solution for those who currently own their automobiles and are becoming frustrated with paying out for MOTs, repairs and taxes.

The British Vehicle Rental and Leasing Association (BVRLA) has stated that small businesses will find van leasing to be particularly beneficial to their needs.

Toby Poston, the group’s head of communications, said that now is the ideal time for those who use commercial vans to switch from privately owned vehicles to hired ones.

He explained that as fleet managers and business owners assess their balance sheets this year, they may worry about having enough cash to cope with emergencies, as costs rise and profit margins become tighter. If they switched to van leasing they would have a much firmer idea of their future expenditure, as the regular payment – be it monthly, weekly or daily – would always be fixed.

This, he said, would allow companies to take greater control of their cash flow as they have a clearer view of costs, which could potentially allow firms to invest in other areas of their business to make it grow.

Mr Poston stated that this was not the only benefit of van hire.

In recent years, vehicle depreciation and used van prices have fluctuated by as much as 60 per cent in the space of a few months, making it very difficult for businesses to keep track of their assets and total worth.

Perhaps more importantly, many leasing customers have the added security of knowing that they will not be left stranded with a broken-down vehicle for long.

“Many leasing contracts also include maintenance and servicing, which protects the customer from any unforeseen rise in these costs,” said Mr Poston.

According to the expert, van leasing is also the best option for those who are looking to start up, or expand, a business this year.

“In uncertain economic times, many businesses are confident enough to rent a van to take on new work or in expectation of that happening, but they don’t feel ready to invest thousands in buying a vehicle outright,” he commented.

His comments came after the BVRLA announced its hopes and expectations for 2012.

The organisation said that some businesses will find it tough, as government austerity measures will really hit people in the pocket this year.

Chief executive John Lewis stated that road travel is an essential in modern Britain, not a luxury and that was demonstrated by the fact that 60 per cent of new car sales last year were attributed to fleet purchases.

He expects that more firms will see leasing as the most financially prudent option this year. Many car and van manufacturers also realise this and will produce vehicles which combine fuel economy, performance and reliability.

“We hope that more organisations will take the brave step of tackling the cost-inefficiencies and safety threat posed by their grey fleet, which would also give a boost to the rental sector,” Mr Lewis added.

According to the Department for Transport (DfT), the future shift to greener transport has already started.

The latest figures from the DfT show that 516 new ultra-low emissions vehicles were registered in the third quarter of 2011 – 29 per cent more than 12 months earlier.

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