Leasing is an alternative option for many people who are contemplating buying a new home, car or furniture. While not as popular as owning, leasing represents 27 percent of new car acquisitions for car dealerships according to a 2007 report released by Consumer Reports. Renting and leasing homes is also common, as more than 30 percent of adults in the U.S. choose this over purchasing their own home, according to 2009 data from the U.S. Census Bureau. To earn a profit from people’s desire to lease, you need to learn how to start a leasing company.
Develop a business plan. Determine what items you will lease as part of your company. Conduct an analysis of current leasing options available in your community as well as the demand for leased vehicles, homes and furniture to learn what niche of the market offers the best chance for profit. Write a business plan that includes your findings and details how you plan to capitalize on them to make a profit. Include information about marketing, financing and staffing the business in your plan as well.
Obtain funding. Get a copy of your credit report before applying for funding for your company to check for any errors that may exist on your report. Take a copy of your business plan with you when applying for a business loan at a local bank or credit union, since most financial institutions review these before approving the funding to start a company. Check with the U.S. Small Business Administration to learn if you qualify for small business loans that are guaranteed or offer low-interest financing to help you start your leasing company.
Register your business. Obtain a business license to do business as a leasing company at your physical location by visiting your local city hall or county government building. Complete the form from the Internal Revenue Service website to get an Employer Identification Number (EIN), which registers your business on the federal level. Learn what sales tax regulations apply to your leasing company, and register with the state and local department of revenue to collect and pay any sales tax required. Purchase liability and property insurance to protect your business in case someone is hurt or your property is damaged. Make it a requirement of your leasing contract for the person with the lease to carry their own insurance on the property as well.
Seek out a facility. Find a commercial facility capable of housing your company based on the specific items you plan to lease. For example, leasing furniture requires a large indoor space where you can put furniture on display for customers to browse while a small office is acceptable for a leasing company focused on rental homes and apartments. Browse websites such as LoopNet or Craigslist for properties, or contact a real estate agent who specializes in commercial property to assist you. Ensure that once you have your facility, obtain property and liability insurance to protect the facility as well as your business.
Establish contracts. Employ a lawyer to draft a leasing contract that you can use when clients lease property from your company. Ensure that the contract contains clauses that release your company from liability in case someone is injured or killed when in, on or using the property. Determine what requirements you have for a person to be able to lease from your company, and check that this is written into the contract. This often includes a deposit, a good credit history and references.
Hire staff. Find people willing to serve as employees for your leasing company. Seek out individuals who have good customer service skills and sales experience. Consider hiring a bookkeeper or accountant to manage your finances, payroll, taxes and other financial aspects of your business.
Promote your business. Advertise the leased items you provide using mass communication channels such as radio, television and newspaper. Create a website specifically for your business that shows pictures of the items you have available for lease. Consider special deals during specific times of the year when demand is higher for the products you provide. For example, summer is often a time to run specials on vehicle leases when more people are looking to get a new vehicle. Network with local organizations and individuals who work with people who have short-term needs for housing and transportation, since they are more likely to lease than buy.
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