Should you buy or lease a van for your business?

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Self employment has continued to rise according to the 2014 budget announced by George Osbourne, with 211,000 more individuals in self-employment than the last quarter. According to the Guardian, three of the four most common occupations for self employment were carpenters, plumbers and other construction trades.

Work in these roles normally requires a van in order to transport tools and goods, resulting in a higher demand of vans and in return an increase in van prices. Therefore a question for every new business in the trade industry is whether it is best for them to buy or lease a van.

Buying a van is often the most popular option as it means that by spending a set sum of money you own a van which is thereby yours and yours only. Leasing a van is a contract by which you pay a monthly fee in order to use the van of your choice – you do not own the van and you will be required to return it when the contract comes to an end. However some leasing deals will offer you the opportunity to pay a sum of money at the end of the contract in order to keep the van for good.

According to a report published by online car and van rental site Autorola, prices to buy a van were at a record high of £9,605 on average during March 2014, increasing by £1585 from January 2014. These vans on average were 2-3 years old with 31,927 miles on the clock.

There has been an increasing demand for LCV’s (light commercial vehicles) with a lower mileage recently but they have been in short supply resulting in an increase in price. The average price of £9,605 does not necessarily mean that that is what you have to spend as there is always the option of buying a van slightly older with an increased mileage for a lower price, or a newer more valuable van for a higher price.

So which option is best for you? In theory, it comes down to how financially independent you are. If you can afford to buy a reasonably new van, then that will be the most reliable and secure option. This is due to having full ownership and the initial payment is soon bound to be payed off with the work you complete. It also means that you can always resell the van if you no longer need it or need a quick cash injection, which you can’t do with a lease.

Alternatively if you do not have a lump sum to be able to purchase your own van, leasing can be a better option opposed to buying a very old van or getting a loan in order to cover the payment. This option allows you to pay as you go, so as long as you’re in business there will be no problems. There are also benefits to leasing, such as having a brand new van with full cover and assistance from your vehicle provider.

The final decision should be well thought out – a vital part of the decision making process is to ensure that your business is in a healthy enough position to support either a lump sum or contractual payments for several years. We hope this guide helps you to make the best decision for your business!

DAVID JONES – SECRETARY OF STATE FOR WALES

On Monday evening, the Prime Minister told David Jones that he was to be replaced as the Secretary of State for Wales.

With a general election on the horizon, the Member of Parliament for Clwyd West was one of the casualties of a revamp of Conservative cabinet membership as David Cameron prepares a new team for next May’s battle with Labour.

When he was appointed nearly two years ago, David was thrilled and honoured to become only the second MP from North Wales, after Cledwyn Hughes in 1966, to become Secretary of State for Wales.

During his period in office, his main priority has been the development of the Welsh economy. Indeed, despite disagreements over the details of the final legislation, he fully appreciated the importance of the current Wales Bill going through Parliament in giving a future Welsh Government, if it wished to, the powers to lower the rate of income tax and therefore boost entrepreneurial activity.

This was not altruism alone as the wily and tactical politician in David Jones also knew that such legislation would give voters a choice between two quite different economic approaches and the opportunity to have politicians in Cardiff Bay accountable not only for the money they spend but for raising it as well.

If that alone is the legacy he leaves Wales, it will have an impact for years to come.

His uncompromising approach and straight talking sometimes rankled with some of those in politics who were used to a less confrontational approach.

But whatever the situation, he was always passionate about ensuring that Wales got the most out of the UK Government’s economic policies.

As a member of the Business Advisory panel for the Wales Office, I saw at first hand the efforts being made to help boost the economy through ensuring that Welsh firms took advantage of the opportunities being offered through working with the UK Government, especially in the field of exporting.

During these meetings, David would especially focus on those reports showing that the renaissance in manufacturing was being led by Welsh-based anchor companies such as Airbus, General Dynamics and Toyota, and he was not slow to remind his Cabinet colleagues of such success.

More importantly, and given accusations that the region had been ignored by Welsh and UK Governments in recent times, he was determined to ensure the success of two major projects for North Wales during his tenure.

The first of these, the investment by Horizon and Hitachi at Wylfa on Anglesey, will be the biggest single piece of new Welsh infrastructure for over 50 years and will create thousands of jobs as well as providing opportunities for local firms to be part of the nuclear power supply chain across the UK.

The second - the construction of a £250 million new prison in Wrexham - will create a thousand new jobs during its operation with at least half of these to be recruited from the local area.

He was also a strong supporter of growing Welsh businesses via the Fast Growth 50 project and met many of the winning companies during his tenure.

In fact, his first event as Secretary of State for Wales was at the 2012 Gala Dinner in Cardiff. As expected, his civil servants had prepared a long rambling speech for him, assuming this was just a normal business dinner. When I told him that the businesses would probably give him a maximum of three minutes before they continued with their celebrations or worse still, started throwing breadrolls, he dumped the script in the bin and gave a short and well-received off the cuff speech on the importance of government in supporting Welsh firms.

And what many people do not know is that he would stay right until the very end of the Fast Growth 50 awards, which was normally around midnight, and then drive himself back to North Wales so that he could be at his constituency meetings first thing on Saturday morning. It at least answered our question as to why he was drinking water whilst the rest of us were digging into the wine.

Therefore, David should be proud of what he has achieved in the post since his appointment in September 2012, and I am sure this focus on developing the Welsh economy will continue under Stephen Crabb, the new Secretary of State for Wales.

As one of the rising stars of the Conservative Party, Stephen comes from a commercial background and understands the needs of the business community. He will undoubtedly have his own style in office but I am also certain that he will continue to build on the work of his predecessor, especially in ensuring that Wales makes the most of the opportunities from a growing economy.

A different hand at the tiller may also alleviate some of the issues that you undoubtedly get when strong personalities with sincere but opposing beliefs come up against each other, as is often the case in Welsh politics.

Of course, the former Secretary of State for Wales will be disappointed that the dispute over the electrification of the London to Swansea and Valleys railways lines had not been satisfactorily concluded before his departure but will be pragmatic enough to appreciate that in such negotiations, a new broom may be needed to end the impasse between Cardiff Bay and Westminster over this issue.

I am sure that David Jones appreciates that his beloved North Wales will face many challenges over the next few years in ensuring that it attracts the vital investment needed from both the private and public sectors to secure its economic future. However, the one thing I am certain about is that he will face such challenges from the backbenches with the same focus and determination that he displayed during his eventful tenure at the Wales Office.