A recent survey of over 10,000 consumers showed that 5% of U.S. respondents use a company car as opposed to a personal vehicle, a family member’s car, or no car at all.
A company car is a vehicle that a company provides employees for business purposes. Not all businesses need or want one, but many would do well to consider getting one.
Running a small business is hard enough. A company car brings advantages that may exceed the initial investment cost. Let’s go over what they are:
Lower transportation costs
When you have a company car, you don’t have to worry about reimbursing employees for their travel costs or arranging for other businesses to deliver products, inventory, etc. A company car lets you have a dedicated vehicle for all your business needs.
In addition, company car costs are often tax deductible. That means you can write them off as a business expense to lower your tax liability at the end of each year.
Save time on logistics
On top of saving money, a company car can save time. It lets you not worry about coordinating schedules with public transportation, delivery services, and so on. Instead, your employees can use the company car(s) on their schedule and run errands on short notice. They can also drive straight to their destinations without any stops in between.
Get extra branding
Having a company is like having a moving advertisement for your business. So long as you put your company’s name or logo on the vehicle, it can contribute to your business’s branding.
In addition, by providing a nice company car for your employees, you can boost your brand image and reputation when they take the car to meet with clients and business partners. It will leave a good impression on them and your brand by extension.
Build business credit
Building business credit is essential to qualify for business financing. Fortunately, a company car can help you improve your business credit. As you consistently make car payments on time, your score will improve, making it easier to get business loans in the future.
Use for different purposes
A company car is a versatile vehicle. It can be used to deliver products, run errands, meet clients, and even generate revenue by renting it out to other businesses.
Think of a company car as an asset that you can use to improve your business.
Scale your business
Lastly, a company car can help you scale your business to new heights. It may be just what you need to reach your next client, build your next product, or deliver a service.
Whatever it is, a company car can help get you there. And as you increase the number of company cars you own, you can always invest in fleet management software to manage them.
Final tips for success
If you choose to invest in a company car, here are some tips you should follow:
- Set a budget. You don’t want to go substantially into debt for your first company car. Assess your business’s assets and liabilities to determine what would be a responsible car budget.
- Compare deals. Don’t agree to the first deal presented to you. Get quotes from various car dealers and lenders and carefully weigh your options.
- Invest in car maintenance. Cars lose their value over time, but they’ll lose it faster if you don’t prioritize proper vehicle maintenance. So, set aside funds to regularly service your company car.
Buying your first company car is a big decision. But in the long run, it can be a worthwhile investment.