Need to purchase a vehicle for your small business? There are a few things you should keep in mind during the car buying process. Keep reading below to find out what these things are!
Whether for personal or professional use, buying a car can be a daunting process. There are lots of things to consider, from the practicability of the vehicle to its design and, obviously, price.
When choosing a car for business, there are many options available, hundreds of options in all shapes and sizes and at many price points. But with so many options, how do you know which car is the best choice?
This article shares five things you should pay attention to when buying a company car that will make you choose a vehicle worth the investment.
1Know your budget
The first thing you need to consider is whether you can afford or not to buy and maintain a car. If you have a flourishing company, purchasing a car, which is a pretty expensive investment, won’t be an issue. Yet, if your company isn’t doing great financially right now, you may want to reconsider whether or not purchasing a vehicle is a priority.
Now, here’s the thing: many car buyers fail to consider that a car’s tag price isn’t the only cost they will be paying. When purchasing a car, you also need to pay taxes, registration fees, fuel, and maintenance. So, when calculating your budget, make sure you also consider these extra costs associated with buying a car for your company.
What’s more, you also need to explore your financing options. If you have enough money to pay for your vehicle by cash, there’s nothing more to think about. Yet, if you don’t own that money, or you need some extra money to afford to pay for the car, you will have to explore various car loans options and choose the one that suits your needs the best.
2Know why you need this car
Now that you have a clear idea of how much you afford to spend on a new company car, it’s time to also get a clear idea of what you will be using the car for. Are you planning to use it for business trips? Will you use the car for transporting products? Or maybe you’re buying the car for one of your employees? No matter the reason why you want to purchase this car, it’s important to know it so that you can choose the one that will fulfil your needs.
Say, for example, that you’re buying the vehicle to use it for your business trips. In that case, you should be looking for a fast and comfortable car that also has a variety of safety features to keep you safe on the road.
Or suppose that you’re buying the new company car for transport to deliver your products to your customers. In that case, you’ll need to look for cars that provide enough room for storage but are also fuel-efficient.
But if you’re purchasing the vehicle for one of your employees, it would be best if you’d ask your employee for their needs and preferences when it comes to driving to and from work every day.
3Do your research
Once you know exactly what you’re looking for in a company car, it’s time to start doing your research.
Before you start visiting car showrooms, it’s best that you have an idea of what you want to buy. And, thanks to the Internet, it’s never been easier to research for a vehicle, to compare features on several models, and see reviews from other people on various vehicle models.
You can look through blogs with cars suitable for businesses in your industry. Or, if you already have a car model in your mind, you can look for more information on that specific vehicle and read reviews from other people who own it.
We recommend arriving at the car dealership with a firm idea of your business vehicle needs and what other dealers are asking for the vehicle so that you don’t pay more than you should.
4Consider your company’s image
When choosing a vehicle, there’s one more thing you should keep in mind: your company’s image. The type of business you are in will decide what company car you’ll need to purchase.
For example, if you are in the construction business, a mean-looking truck suits perfectly to your company’s image. Yet, if you are in the real estate industry, an SUV or a sedan is more appropriate for your business’s image. On the flip side, it may look a bit odd to get down of a truck all dressed in a suit for your business meeting with real estate partners.
So, choose a car that makes sense for your company’s industry and image.
5Use tax advantages for company cars
Compared to buying a car for personal use, buying a vehicle through your company has tax advantages tied to it. To be more precise, the operating cost for every car registered to your company is a deductible cost.
Yet, if you use the company car for personal purposes, you are allowed to deduct costs related to business use. But these deductible costs can mean significant savings, especially if you have a small business.
Buying the right company car for your business is a significant yet important expense. You’ll be using the vehicle to travel for business, to transport products from your location to your clients, and to make a good impression to your partners. If you follow the tips we’ve shared above, you’ll purchase a company car that is worth the investment.