Some small businesses live in office buildings, but others live on the open road.
Entrepreneurs know that traveling on the company dime can be a worthwhile investment when done right. However, treating it like a vacation can leave a small business with a huge expense and very little else to show for it in terms of new clients or partnerships.
A company car can be a literal manifestation of this issue. Driving to meet customers face-to-face can improve relations and create a lifelong customer base. But using a company car like a reckless teenager can get you in a whole mess of financial trouble. When shopping for a vehicle for your organization, what should small business owners keep in mind?
"Don't settle on a car that fits your budget, but won't fit your personnel."
Buy an environmentally – and financially – sustainable car
Hybrid cars are all the rage, supplementing fossil fuels with electricity to get people where they need to go. But many small businesses, small as they may be, don't necessarily fit inside a compact car. While a door-to-door salesman might only need a briefcase and a product to demonstrate, an in-house cleaning crew may need to transport multiple employees along with several hefty machines. Don't settle on a car that fits your budget, but won't fit your personnel.
Additionally, what you tow directly relates to how effectively your vehicle uses gasoline. Buying a larger car suited to carry heavier loads can be just as efficient as stuffing a smaller car full of equipment.
No such thing as bad press
In an interview with Inc.com, Meg Roberts, a vice president at Service Brands, spelled out an integral reason why a business owner should invest in a car he or she can customize.
"Even when the car is in a parking lot, it is still representing the brand," said Roberts.
Get the most out of your investment by adorning your company car with your company's logo. Adding information like a telephone number or website can draw attention 24/7. Driving to pick up office supplies or a catered lunch can double as cheap and effective advertising. So when you're looking through the car lot for the ideal vehicle, make sure it has enough space for a little extra publicity. Nothing permanent though – you don't want to hurt the resale value!
Master the art of the tax deduction
Depending on how you finance your car purchase, your small business may be entitled to tax deductions. However, don't just fly into a purchase agreement without knowing what you'll get in return. For example, Demand Media says vehicles purchased with a loan cannot receive a tax write off, but parts of the interest on that loan can.
In any case, a percentage of your mileage can also be deducted from your taxes, so long as the venture in question was work-related. Unfortunately, the government won't reimburse you for an afternoon trip to the spa, no matter how much a deep-tissue massage can improve your productivity.
Equipment and business industry piece brought to you by Marlin Equipment Finance, leaders in equipment financing. Marlin is a nationwide provider of equipment financing solutions supporting equipment suppliers and manufacturers in the security, food services, healthcare, information technology, office technology and telecommunications sectors.