Leasing, hire purchase or financing: Cargobull Finance has an effective solution for any
Safeguard your Liquidity
Horstmar, March 2009 - Fresh strawberries, tons of paper rolls, dissected pig halves:
The customers’ requirements differ just as much as their transported goods vary.
Here the modular trailer system has proven its worth and with Cargobull Finance there
is a service provider who can provide the ideal financing components for the customer.
Leasing, hire purchase and financing with customer-specific options and service
packages are available from a single source. The highest priority is always the liquidity
of the customer.
Toll increases and environmental regulations are putting the haulage companies under pressure.
At the same time transport volumes are falling. Nevertheless: quality has priority in the
competition for future orders in spite of the pressure on prices. Hauliers will therefore scarcely
be able to afford to compete with obsolescent technology. “Forward-looking companies have
long realised that particularly in these times they have to further invest in modern and efficient
vehicles,” says René Roelfsema, Cargobull Finance Managing Director. However, as a
consequence of the financial market crisis most of the firm’s banks will not act as lenders:
extremely high securities and hefty risk surcharges in the form of rising interest rates on no
longer affordable to most forwarding agents. Alternative forms of finance are therefore highly
Liquidity, Liquidity and Once More Liquidity
“The order of the day is: liquidity, liquidity and once more liquidity,” explains the Managing
Director of the Schmitz Cargobull subsidiary. Financing solutions should provide both additional
financial leeway and – together with calculable costs –security over the entire contractual term.
In the selection of the suitable financing model the decisive factor is always the individual
solution of the specific company. For example, leasing offers a range of contractual options:
with a service agreement, with a purchase option at the end of the term or with an option to sell.
The greatest advantage of leasing: it has no effect on the balance sheet. All instalments are
considered to be operating expenses and are deductible in full.
Full Service Agreements the Latest Trend
These advantages are increasingly being used by medium-sized businesses. According to the
Federal Association of German Leasing Companies (BDL) there are currently commodities
being leased in Germany to the value of well over € 200 billion. The annual volume of new
business – i.e. the procurement value of the items for which in the respective year new leasing
agreements are concluded – has risen continually and reached the record value of € 57.1 billion
in 2008. As a result the leasing sector is by far the largest investor in the country. According to
the BDL, demand is moving away from exclusive financial leasing to full service agreements.
Contract Lease, the “All-Round Carefree Package”
“The transport company can concentrate fully on its core business. Everything else is taken over
by our specialists,” explains Roelfsema. Cargobull Finance (CBF) calls this “contract leasing”.
This is a leasing agreement that includes a full-service package. The customer can agree this
all-round package directly with their contact person in the sales department. This obviates the
need for complex financing discussions with the bank. For repairs, maintenance and service the
blanket pan-European service network of Cargobull Parts & Services is available with 850
By means of a vehicle protection package – an insurance policy for their trailer – the purchaser
is reimbursed for all of the costs for restoring the vehicle in the case of unforeseeable damage.
For an indemnifiable write-off the residual book value is generally reimbursed up to an amount
of 130% of the insured sum. If the customer decides on this option the follow-up costs – such as
clearing up and disposal costs, movement and protection costs, as well as recovery costs in the
case of a write-off – are reimbursed up to a level of € 5,000 net.
A further new, flexible offer from Cargobull Finance is the so-called “easy hire purchase” with
12 months’ contractual term. If the customer needs the trailer beyond the agreed period of use,
they can take advantage of follow-up financing to obtain an extension option of 36 months.
“Easy hire purchase” gives the customer security through flexible instalments. These are
adapted to the customer’s budget, for example by means of degressive financing.
In addition to the new offers, Cargobull Finance has more than eight years’ experience as a
financer of new and used commercial vehicles. More than 50,000 vehicles have been financed
since the firm was established in 2000. Almost every fifth vehicle is covered by a full service
agreement. And this figure is continually rising. “The basis for the high level of acceptance among
customers is our extensive experience, particularly with the country-specific conditions and tax
laws,” Roelfsema is convinced.
Currently there are 18 countries in the Cargobull Finance network with the latest subsidiaries in
Russia, Romania, Hungary and Portugal. Here the technical knowledge of Schmitz Cargobull
harmonises perfectly with the financial expertise of the banking professionals of De Lage Landen,
which belongs to the RaboBank, which is in a healthy position in spite of the financial crisis.
“We do not have any problems with liquidity,” reports Roelfsema. If the forwarding agent fulfils the
corresponding credit rating specifications there is nothing to prevent finance being awarded in the
Advantages of Hire Purchase/Leasing
(The respective contractual forms are country-specific):
• secure planning with fixed instalments
• no encumbrance of existing credit lines
• flexible contractual term and course of payments
• transfer of ownership
• “pay as you earn”; you pay when earnings
• have already been generated
• no effect on balance sheet, increases liquidity
• leasing instalments deductible as operating expenses
• lower, fixed calculable instalments
• low administration costs
Full service leasing (additional):
• no maintenance or repair cost risk
Leasing (to lease = rent, let) is the form of renting out of commodities by the producer of these
commodities or special leasing companies in return for the periodic payment of leasing instalments.
Hire purchase: Form of leasing in which after the expiry of a temporary rental agreement the
customer can decide between purchasing the rented object taking into account rent that has
already been paid, extension of the rental agreement or the return of the rented object.
The Schmitz Cargobull press team:
Gerd Rohrsen: Tel.: +49/2558/ 81-1323 Number of words: 1.051
Andrea Ewering: -1321 Number of characters (with spaces): 6.866
Olga Leuer: -1303
Fax: +49/2558/ 81 -1287
Email: firstname.lastname@example.org email@example.com