Article by Jamie Kane,
Product Marketing Manager,
John Deere Financial

A logger’s ability to have the equipment and cash flow they need when they need it is vital to running a successful operation. When acquiring new equipment, it is important to utilize your dealer to identify a financing solution that makes the most sense for your business.

Joe and Joey Ross of J&J Logging in Macon, NC, worked closely with their dealer to determine the best financing options. They selected a solution that not only saved them money, but also allowed them to acquire new equipment, decreasing money spent on repairs and downtime in the long run.

After experiencing substantial downtime and repair costs with a mixed fleet of used machines, J&J Logging decided to make a switch to new equipment from one manufacturer. After meeting with their dealer, the attractive financing offerings made the process easier and opened the doors to even more equipment options. After reviewing their financial history, J&J Logging qualified for zero percent financing and interest. This allowed the company to use the saved monthly cash on improving their business and crews.

When making the switch from used to new equipment, Joey knew they would end up paying more each month than they would with used equipment. However, from a long-term perspective, he also realized they would save more money by not needing to spend thousands of dollars on repairing older equipment. J&J Logging was able to replace five older machines with three new models, increasing machine productivity and creating savings. The switch was easy to make once they reviewed their options with the dealer.

Attractive financing offers enable loggers to increase their monthly cash flow and invest the savings into improving their business in an increasingly competitive market. Loggers should work with their dealer to review their business and financial history in tandem with their financial advisor or accountant, creating a financing plan that makes the most sense. Additionally, it is important to consider factors like downtime and productivity when making a decision. While used equipment may seem like the cheaper solution, over time it may be more beneficial to combine new equipment with financing options to maximize cash flow throughout the year.

When looking to purchase equipment, the dealer can help simplify the financing process, allowing loggers to focus on growing their business. Additionally, dealers can help with the decision making process, walking through the operation’s business history and projected jobs, cash flow and financial history to identify all of the financing options available.

Butch Lewis, owner of Lewis Logging, LLC., in Chester, SC, also takes advantage of financing for all of his equipment purchases, whether he is trading in a machine or putting money down. When Lewis is ready to purchase a new machine or upgrade an older model, he simply calls his dealer who travels to the jobsite, bringing the necessary paperwork to complete the purchasing process. Lewis is able to get the equipment he needs without needing to take time away from the job at hand.

In Haddock, Ga., Kip Smith with Kip Smith Forest Services, LLC also utilizes financing for his equipment purchases. His dealer simplifies the entire process, acting as the liaison between the manufacturer, financial department and the customer, allowing Smith to focus on his business. By working with the dealer to identify low interest financing rates based on his financial history, Smith can put that money towards his business.

Loggers should consider other options when reviewing financing plans, including unique options that can help with weathering the ups and downs of the logging industry throughout the year. Some manufacturers offer skip payments, which allow the customer to select one to three months to skip the payment. An offering like this can be extremely beneficial during anticipated slow seasons, allowing loggers to pocket the money that would normally be spent on a financing payment.

Additionally, loggers should look beyond equipment when they meet with their dealer to discuss their financing options. Financing also allows loggers to have the items they need, like attachments, spreading payments out over time instead of spending one amount all at once. Extended warranties, maintenance packages and insurance are other added items that can be financed, allowing loggers to focus on the growth of their business and spend less time worrying about unexpected costs down the road.

In a business where cash flow and efficient, productive equipment is key to the success of the logging operation, financing offers a great opportunity for loggers to acquire the items they need to get a leg up.