The idea that you should always pay cash to purchase IT equipment is a bit of a myth, not that it actually happens. His point is that liquidity is crucial to the longevity of any company. It is difficult to scale your company based on the reinvestment as well as personal savings from profits, especially in the beginning phases. To scale your business, you’ll need to raise funds from the outside.
A loan is superior to using cash to purchase equipment. It can take longer to put an account for savings rather than making a loan for financing the equipment. Savings could mean significant expenses if you wait.
Businesses often go under because they lack funds. Your business’ success depends on maintaining liquidity and having reserves for emergency situations. The need for a loan to create business credit is another reason to consider getting a loan. While there are benefits presented in cash payments to purchase IT equipment, your company should be able to support the purchase and be prepared to take on any risks that come with it. sxkcy5bgme.