Van: Lease or Buy?

Can anyone provide any information on what is best as a business?

Much appreciated.

Martin

Could you ellaborate on "what is best for business"?

I'm getting a contract with UK Mail but need a van less than 4 years old, so is it better leasing where its easier to get a new van and sometimes costs less than buying or buy one and then everything's my responsibility like servicing and repairs.

I've always bought, but looking at repair and maintenance costs it's a fine line. With lease or rental fixed costs 100% tax deductible.

Judging by your other post, is the insurance seperate regardless?

You need to research THOROUGHLY all aspects of the business you are entering. Only you know the financial situation you are currently in. What suits one may not suit another.

Best advice I would give is to employ a 'quality' accountant and ask his advice. He will know your financial situation and would be best placed to offer you advice. There are for and against arguments as to leasing, renting etc.

Yeah the insurance is a completely different issue unfortunately.

Alan judging by his age and insurance quote hes in a difficult one.

Well like RLT says it may be better to do your homework & seek advice from a financial point of view.

Stuck between a rock and a hard place I reckon Gary, that's why some professional advice would make sense.

There will of course be the regular 'experts' on here later, who will no doubt know the right answer LOL

Martin it seems you have your head screwed on judging by your questions and answers. Only you will know the answer by seeking expert advice in incomings and expenditure. But both owning or leasing have their advantages and disadvantages. And like it was said some regular expert advice may be given later, some useful and some pointless, but it will help you either way. Good luck

Multi dropping is a strange animal! I would get a van from your local hire company on a monthly basis for the first 2 months to see how you get on, You don't want to be burdened down with a van on a 3 year lease if you get fed up after 3 weeks, It's suits some people but not others,

I would say have ago at it your average same day courier or lorry driver likes to sit on his big ass and do nothing all day. Then complain about working hard I have never understood that one. I when I was a big younger actually enjoyed multidropping I did a lot of continental work and long distance UK work then we got involved with Businesspost and ANC Target and Then DHL. For me I enjoyed this little daily challenge people used to say it was hard work but I had become very bored with just sitting there on the motoways and this provided me with someting different and something to get our teeth into. Most importantly I was at home every night and weekends. I actully put employed drivers on sameday and did the multidropping mysef because I enjoyed it. Mr Springer rightly said its a strange animal but some people do enjoy it and stick at it you just need to discover if it is for you

That wouldn't be you offering a "back up" service for the big boys would it Bob?

Customer uses DHL to deliver their goods... DHL is the Courier You working for DHL is YOU being THEIR back up

Doesn't sound so silly now does it Bob..

Barnsley Shipping said:

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I would say have ago at it your average same day courier or lorry driver likes to sit on his big ass and do nothing all day. Then complain about working hard I have never understood that one. I when I was a big younger actually enjoyed multidropping I did a lot of continental work and long distance UK work then we got involved with Businesspost and ANC Target and Then DHL. For me I enjoyed this little daily challenge people used to say it was hard work but I had become very bored with just sitting there on the motoways and this provided me with someting different and something to get our teeth into. Most importantly I was at home every night and weekends. I actully put employed drivers on sameday and did the multidropping mysef because I enjoyed it. Mr Springer rightly said its a strange animal but some people do enjoy it and stick at it you just need to discover if it is for you

After all that, does the chap buy or lease a van?

I was thinkin similar

Lots of words but not actually saying anything

Tiz a theme from some on here

http://www.youtube.com/watch?v=qQ8kXlsme4c

As you are new I'd say Rent instead, similar cost to leasing but without the commitment.

Evaluate profit/loss every few months and recalculate if it's worthwhile changing to lease or purchase.

I'd be interested to know how many starter motor and/or other ignition components would be covered on a lease plan, would you end up paying for extras? At a guess you'd get through a fair amount doing multi-drop, unless you leave it running for the local opportunist to have a free ride home.

Perhaps one of our experienced multi-droppers could enlighten us?

I walked away from a multi-drop opportunity because I figured that the daily rate wouldn't be enough to cover the excessive wear and tear for even the starting rate of 50-60 drops, let alone the 100 or more you are expected to 'graduate' to.

Also, mileage can be a factor, I saw a couple of lease plans where the mileage wasn't much per annum (15-20k iirc). The penalty for going over this was mentioned in pence per mile so it sounded minimal, but when you add up 30-40k miles multiplied by 5p per mile that's £1,500 - £2,000 extra for a start!

I never really thought of the rent option. I will phone around my local vehicle rental firms tomorrow and sort out a rate.

Thanks for your input guys. It's much appreciated.

Leasing usually commits you to pay monthly for the van for a fixed term, if you are ill do you have someone else to do the work whilst you recover, you will also have to maintain the van and may find that you are charged a fee when you send it back depending on condition.

Hiring will give you a higher fixed cost but will include all maintenance, tyres and RFL and enable you to budget more easily.

I would suggest that you consider hiring for at least 3 or 4 months and then look at either leasing or HP when you have discovered how many days work they ACTUALLY give you.

Whilst you are hiring try out 2 or 3 different makes vans to see what different weekly fuel costs work out at.

Depending on the routes you are given the fuel cost may well be more than all the other costs of running the van put together.

Multidropping needs a certain type of mentality, never feel stupid for spending an extra ten minutes planning your route before you leave the depot, (or just round the corner out of sight).

I threw myself into the deep end, so to speak, back in 2001 and soon realized that taking a laptop with me and using Autoroute to plan the days work was the way to go for an unfamiliar area.

Just checked your Insurance post and noticed that you are under 25 so hiring will be out of the question at most vanhire firms.

You will probably have to buy a van outright unless UKMail can point you in the right direction... They may have a deal with a hire co such as Northgate.

If you definately got regular work I would lease. Northgate (Norflex)are good and can stop anytime. Give em a ring Martin