Leasing demand is looking good

Published:  05 June, 2009

BRISTOL: A post-recessionary mindset is starting to emerge among leasing customers. The result is that capital expenditure is once again on the agenda ... 

according to technology and financial services company, GE Capital. 

The leasing specialist said that feedback from existing and potential customers suggests that many feel that the bottom of the recession has now been reached and that while there is no indication of a rapid return to general economic growth, there are tentative signs of increased confidence.

Marie Dunkley, commercial leader, explained: "For many businesses the onset of the recession felt like falling through a trapdoor and, as a result, capital expenditure of any kind has been unthinkable. They have simply been concentrating on survival.

"However, the feedback we are receiving suggests that a number have now seen demand stabilise or the rate of decline slow dramatically over the past few months.

"They are starting to believe, if nothing else, that this is the bottom of the recession. Many remain profitable – if not to the degree of recent years then to a level that appears to be sustainable and relatively healthy."

Ms Dunkley added that this stability was leading to the emergence of a new mood – one where companies were beginning to believe they could survive and maybe even thrive within the new economic reality.

She said: "That doesn't mean that businesses believe the end of the recession is in sight, but they are starting to shake off the degree of fear that has gripped them over recent times. They are starting to make new, more positive plans."

A result of these plans was an increased level of interest in capital expenditure, with leasing very much being pushed to the fore where new equipment acquisition was needed.

"Because of this mindset, we believe that leasing could be the acquisition method of choice. While decision-makers are regaining some of their appetite for new ventures, they still want to do so at a low level of risk.

"Leasing – thanks to the advantages it inherently offers such as predictable costs and avoidance of residual risk – could be set to make genuine gains in this environment."

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