As a business owner, you would always want to make sure your expenses are justified. Regardless of whether you are spending on a marketing campaign or new office space, you want to ensure the pros outweigh the cons.
Now, vehicles are a significant investment in terms of monetary value. Thus, most businesses think twice before buying one, and in many cases, they refrain from taking the plunge. But having a dedicated business vehicle is a crucial investment for more reasons than one.
So, are you still wondering about one good reason to buy a business car? Here’s giving you five.
1. Unreliable Services Can Be a Huge Turn to Clients
If you aim to be one of the well-known leaders in your field, you will have to be reliable regardless of your business area. Having your vehicle make strange noises or break down when you are on your way to meet clients or drop off something isn’t a good sign of dependability. Ensure that you service the business car regularly, or else potential clients might take their business somewhere else.
Besides, failing to service your business car regularly can cause expensive breakdowns. There is a greater chance of significant parts breaking down when you do not regularly service your vehicles. Of course, servicing will cost money, but replacing old parts and rebuilding engines are costlier than that.
Keeping your company vehicle in mint condition will help you offer prompt service to your clients and prevent breakdowns.
2. Time Is Money, And Promptness Draws Appreciation
You must have heard the adage “time is money” multiple times before, and it rings the truest in all kinds of businesses. Think of this situation: it is 2:30 p.m. on a Tuesday when you need to shuttle four tired colleagues and a boot full of sample products to a client who stays two towns away.
Hiring a suitable car that late and in an instant is going to be anything but easy. Now imagine how easy things would have been if you already had a proper land cruiser ute. Nothing is worse than not having your business car when you have to make a delivery right on time or when your team is on the way to a crucial meeting. Save a lot of time in each of these scenarios by simply having a business vehicle at your disposal.
3. Keeping the Vehicle Liability Factor in Mind
Vehicle liability is the chief reason to put a vehicle in your business’ name. A section of business owners is under the impression that they get personal auto insurance coverage when their car is out for business purposes. Others feel their business insurance completely covers them and their staff if they get into accidents while driving their vehicles.
Unfortunately, this is not the case. If you crash into someone while driving the car for business reasons, who do you feel can get sued? Yes, you’re right: both you and your company. By designating the vehicle in your business’ name, you are removing personal liability and shifting it to your company. You can contact your insurance professional for more details. But one thing is for sure: outlining vehicle liability beforehand helps deal with possible insurance hassles down the line.
4. Loss of Car Insurance Coverage and 100% Financing
Some car insurance companies might deny claims on your insurance coverage if the accident happened while you or your employees were using the car for business reasons. It might leave you personally liable and uninsured. Also, discuss the matter with your insurance carrier.
Business owners will often purchase a used or new vehicle for the company in their name as they can get a hundred percent financing. They will not need to use other business capital for making a down payment.
Indeed, there was a time when a hundred percent financing for business cars was not available. But, now, many financial institutions offer such financing to businesses operating for a year or more. Many credit unions offer to finance or refinance options up to a hundred percent of a used business car. It will let you expand while saving capital for other reasons.
5. The Tax Advantages of Having a Business Vehicle
Though the personal deductions you can take upon using your car for business reasons might seem enticing, you might leave some crucial tax benefits for your business on the table. You only need to title the car under your name to solve everything. You need to review this each year with a tax advisor to make sure you’re capitalizing on all the benefits available to you and your company. Another significant factor to consider is whether the personal deductions are sufficient for mitigating the potential liability aspects mentioned above. At times, they are not.
Talk to your tax advisor instead of making this decision on your own. The tax advisor will ensure they consider every aspect of vehicular use to make the best decision for your business.
Key Takeaway
All the reasons mentioned above clearly show that having a business car is a worthy investment. Though you will need to shell out the bucks initially, the convenience you’ll get as a result is priceless. Once you have your business car, you would wonder why you ever thought twice about getting it before.
Iftalia