Every organisation needs access to up-to-date equipment to operate to its full potential. But it can be tough to decide when to replace these assets, or realise when you may need to invest to meet future productivity or growth targets.
Every asset has a lifecycle and while companies want to get the most out of their equipment, however using outdated equipment can harm the business from both productivity and profitability perspectives .
So what are some consequences businesses may experience if they don’t update or replace outdated equipment regularly?
Declining profits or poor staff retention rates
An old adage is never to turn your back on the ocean for fear of being swept away. You should think of technology in the same way. No business can afford to turn away from technology.
Apart from not having access to the latest digital tools, not investing in technology on an ongoing basis also limits a business in other ways. For instance, businesses that don’t invest in the latest cloud-based technology risk losing data or having their data corrupted.
They will also find themselves unable to process information as quickly as their competitors, or struggling to collaborate or communicate effectively.
Lost time responding to customers’ queries can result in missed business opportunities, and the risk is that this will have a bottom line impact down the track. This is why it’s so important to ensure everyone has access to leading technology. Without it, the risk is profits fall, morale is affected and retention rates suffer.
Outdated equipment performance
The Internet of Things (IoT) is one of the key technology trends of our time. IoT is the ability for inanimate objects, such as machinery, to be connected to the internet. This connection delivers information about the equipment such as when it needs to be serviced, whether it has a fault or whether a part is scheduled for replacement.
A good example of how this is revolutionising industry, is telematics in transport and fleet management. Telematics allows better usage of key road assets, and ensures that they are managed to peak efficiencies, achieving a better ROI.
Capital intensive organisations that operate in an IoT environment are giving themselves a competitive advantage compared to those that are not exploring this avenue.
If you have not already looked into the potential of IoT for your business, now is the time to do so.
Fast-paced change when it comes to specialised equipment
Many businesses operate in industries that require specialised equipment to function. The health sector is a good example of this. Dentists, doctors, pathologists and radiographers are just some of the specialists that could not operate without high-tech, specialised equipment, and using outdated equipment could harm a patients outcome.
But the machinery and tools these experts use are typically expensive and technical. So there’s real skill in knowing when to invest in new equipment.
Without access to financing solutions most of these businesses simply would not be able to operate. Which is why it’s essential to work with finance providers who have in-depth understanding of the lifecycle of specialised equipment and can provide solutions that match that lifecycle and the business’ cash flow.
With technology changing at such a rapid rate, no business can afford to operate using old, outdated equipment. Those that do so are unnecessarily putting themselves at a disadvantage, and are risking their own productivity and growth.
With the current strong economic environment including record low interest rates, conditions are ripe to explore how equipment financing can help your company reach its full potential. It’s about ensuring your firm is operating above industry averages, and increasing productivity, performance and most importantly profitability.