Want to Learn More About Asset Finance This New Year?
- Lend Brokers
- Jan 15
- 3 min read
As we step into 2025, now is the perfect time to consider smart financial strategies for your business. Asset finance is one such strategy that empowers businesses to access essential equipment, vehicles, or technology without straining cash flow. Whether you’re looking to expand operations or upgrade your assets, asset finance provides flexible solutions tailored to your unique needs.
Investing in your business's future through asset finance can unlock growth potential, preserve working capital, and keep your operations running smoothly. But to make the most of this financial tool, it’s important to understand the different types of assets and how they impact financing terms. Let’s dive into the classifications of primary, secondary, and tertiary assets to help you make informed decisions.
Primary Assets
Primary assets are highly desirable to lenders because they have longer lifespans, higher resale values, and minimal depreciation. These assets are fundamental to business operations and can often be liquidated easily if necessary. Because of their low-risk profiles, lenders are more likely to offer favourable terms for financing primary assets, such as lower interest rates and longer repayment periods.
Examples of primary assets include:
Commercial Vehicles: Trucks, trailers, and large commercial vans essential for transporting goods and services.
Light Commercial Vehicles: Cars and utes used for delivery or sales representatives, though sometimes considered secondary assets depending on their use.
Commercial Real Estate: Offices, warehouses, and retail spaces that are central to daily operations and can appreciate in value over time.
Heavy Machinery and Equipment: Construction machinery (e.g., excavators and cranes), agricultural tools (e.g., tractors and harvesters), and manufacturing equipment essential to specific industries.
Secondary Assets
Secondary assets, while still valuable, generally have shorter lifespans and higher depreciation rates compared to primary assets. They may not be central to daily operations but play an important supporting role in a business’s activities. Financing terms for secondary assets may include slightly higher interest rates or stricter eligibility requirements compared to primary assets.
Examples of secondary assets include:
Office Equipment: Computers, printers, and furniture that facilitate administrative tasks but depreciate quickly.
Specialist Equipment: Industry-specific manufacturing tools or devices with limited general use or shorter lifespans.
Tertiary Assets
Tertiary assets are the most challenging to finance due to their lower resale value, rapid depreciation, and a less critical role in core business operations. However, they can still be essential for specific industries or businesses. Lenders may require additional documentation to justify the necessity of these assets and often provide shorter repayment terms with higher interest rates.
Examples of tertiary assets include:
Technology: IT equipment such as laptops, desktops, software, and phones that are crucial for modern businesses but lose value quickly.
Fixtures and Fit-Outs: Office renovations, customised fittings, and other modifications that enhance functionality but have limited resale value.
Specialised Equipment: Niche tools, such as medical or gym equipment, which are critical for certain industries but have limited market demand.
Why Choose Asset Finance?
Asset finance is a practical way to acquire the tools your business needs without depleting your cash reserves. By understanding the classifications of assets, you can better align your financing choices with your business goals and negotiate favourable terms.
Whether you’re investing in primary assets to expand operations or upgrading secondary or tertiary assets to stay competitive, asset finance can help you seize opportunities and support long-term growth.
Partner with Lend Brokers in 2025
At Lend Brokers, we specialise in helping Australian SMEs find tailored financing solutions that meet their unique needs. Our expertise in asset finance ensures that you can secure the best terms for your business’s growth and success.
Ready to take the next step? Contact Lend Brokers today and let us guide you through the asset finance process. Together, we can make 2025 your business’s best year yet!
This post is intended for informational purposes only and doesn’t consider your personal financial situation. Always seek guidance from a financial advisor when making significant financial decisions.
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