When you own a business, you’ll likely need certain equipment to be successful. Computers, furniture, fixtures, machinery, electronic devices, and office equipment are some examples of equipment you may need while operating your business. Problem is, it can be quite difficult to afford using your own capital. Thankfully when businesses in Canada require funding for equipment, they have a variety of financing options available including, debt financing, leasing, equity, trade credit, and government financing.
As seen in the graph above, debt financing has become one of the key ways businesses have been financing their needs and expenses. Debt financing includes many forms of credit such as business loans, business lines of credit, merchant cash advances, and more. Of these, a business loan provides the greatest versatility and convenience. So if you’re looking to purchase new equipment to upgrade your current setup, increase your output or expand your product list, a business loan can be just what you need.
No matter what type of business you operate, quality on-site equipment can be pretty expensive. Let’s say you’re trying to furnish your own restaurant, bar, or coffee shop. While you may be able to cover some expenses by yourself, most kitchen equipment (fridges, beverage dispensers, ovens, etc.) can certainly cost a pretty penny. And let’s not forget just how expensive manufacturing equipment can be. This is where a business loan can open so many doors for you and your company. With a business loan, you’ll be able to purchase the equipment you need to take boost your profit and sales.
When you’re a business owner, there are plenty of areas you can use your financing, including purchasing the right equipment to get the job done. Here are just some types of business equipment you can finance with a good business loan:
Amount APR Term (months) 
1k-300k Fee-Based: Starting at 9% 12- 60 Learn more 
5k-300k 8% – 29% 6-18 Learn more 
1k-500k +5.9% 3-60 Learn more 
Up to 300k 8%-22% 6-12 Learn more 
5k-500k - 6-18 Learn more 
100K + 6.05% + 60 Learn more 
5K-100k 15%+ 12-18 Learn more
In addition to business loans, entrepreneurs and business owners can use equipment loans to finance their equipment. While both options provide the same solution, they work very differently.
A business loan is a form of financing where you receive a lump sum of cash that you must repay with interest within a specified amount of time. Repayments are usually made bi-weekly or monthly. Business loans are extremely versatile and can be used to not only purchase equipment but it can be used to pay suppliers, improve cash flow, cover rent and more. Moreover, a business loan can come in two forms:
An equipment loan is a loan that is secured against the equipment that you are purchasing. Like a business loan, you’ll receive a lump sum of cash that you must repay with interest within a specified amount of time. However, unlike a business loan, most lenders will only finance 80% of your equipment price. As such, you’ll have to fund the other 20% yourself or use another form of credit to fund it.
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Being able to qualify for a business loan is important as it can not only help you purchase equipment, but it can also help with cash flow problems, payroll, inventory, and other business expenses. According to a study conducted by the Government of Canada, businesses struggle to grow due to a number of factors including the rising costs of input, cash flow problems, debt problems, and inability to obtain financing. Small businesses with less than 100 employees particularly struggle to obtain the financing they need to grow their business.
| 1-4 employees | 5-19 employees | 20-99 employees | 100-499 employees | |
| % of businesses who’ve struggled to obtain financing | 8.5% | 10.6% | 8.8% | 4.5% |
| % of business who struggle with cash-flow or debt problems | 12.7% | 15.4% | 13% | 11.6% |
| % of businesses who struggle with input costs | 14.6% | 18.9% | 19.3% | 16.9% |
In order to help you qualify for the financing you need, we’ve listed common documents a lender will request when approving a loan.
While many types of equipment can eat into your business budget, that won’t be a problem when you choose us for your financing requirements. And, good financing isn’t the only benefit we can provide. In fact, there are plenty of other reasons to pick Loans Canada, including, but not limited to:
Remember, Loans Canada is here to help set you up with the best source of financing for your business equipment. All you need to do is apply below!
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