Operating leases: the key to accessing supply chain automation

Sep 6, 2023


In the ever-evolving landscape of intralogistics, where the convergence of automation and digitalization is reshaping the way businesses operate, finding a sustainable and cost-effective solution for upgrading equipment and technology is paramount.

This is where an operating lease emerges as a game-changer. In this blog, we will delve into the concept of operating leases in intralogistics, the benefits, and how it enables businesses to seamlessly navigate the challenges and opportunities of automation and digitalization.

Making the unreachable reachable

At the heart of an operating lease lies the concept of value preservation and affordability. In most cases, high upfront costs associated with intralogistics equipment and technology hinder businesses from adopting the latest innovations. An operating lease comes to the rescue by allowing companies to embrace these advancements without the financial strain.

Unlike traditional financing options, an operating lease offers a unique approach. In an operating lease, a portion of the project's value is set aside as a residual value. This upfront reduction in cost significantly lowers the monthly repayments, making complex intralogistics projects financially feasible. By choosing a shorter initial term for the lease, but taking a higher residual value position, a business can reduce its monthly payments while, at the same time, staying more flexible at the end of the lease period.

A path to financial efficiency

One of the distinguishing features of an operating lease is its classification as an operating expense (OpEx) rather than a capital expense (CapEx). This financial distinction has far-reaching implications. operating leases provide businesses with flexibility, allowing them to allocate their own capital more effectively and manage their budget more efficiently, thereby enhancing their ability to invest in growth-driving initiatives.

Customized leasing for your entire project

The complexity of intralogistics projects often demand unique financial solutions. DLL stands out in this regard by offering bespoke financing structures tailored to each customer's needs. Unlike conventional financing institutions that often limit their support to tangible assets, DLL goes the extra mile. Not only does DLL fund the hard assets, it also finances the entire spectrum of the project, including soft costs like engineering, training, and installation. In addition, DLL can structure a “no cash out solution” for its customers, by also funding all progress payments due to the suppliers during the installation period.

The flexibility to align payments with business cycles

DLL recognizes how the ebb and flow of business cycles can impact a company's cash flow. To address this challenge, DLL offers innovative solutions like seasonal payment variation whereby a business that experiences peak activity during certain months can benefit from varying payments accordingly. This approach eases financial stress on a business during quiet months and aligns leasing payments with the business's revenue patterns.

Embracing the future of intralogistics

As businesses increasingly incorporate automation and digitalization to stay competitive, operational leasing can be a versatile tool in their arsenal. This financing approach not only ensures the affordability of cutting-edge technology and equipment but also facilitates smooth transitions to automation installations. Leasing empowers companies to embrace these transformations without the burden of hefty upfront costs, making operational enhancements an achievable reality.

At DLL, we offer innovative, tailored financial solutions to enable your intralogistics transformation and accelerate your business’ growth."

Enabling your intralogistics operations with DLL

“At DLL, we offer innovative, tailored financial solutions to enable your intralogistics transformation and accelerate your business’ growth,” says Steven Davey, Sales Manager, Intralogistics at DLL. “Explore the possibilities of operational leasing today and embark on a partnership towards a more efficient, productive, and profitable intralogistics operation.”

Contact us today to speak to an expert about your intralogistics financing needs.

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