Yes, you probably already own your own car. However, should you buy a new one specifically for business use? Your initial thought could be: “Of course not, I’ll just use my personal car for my business, too.” However, a car can surprisingly struggle to do double duty like this.
For this reason, you could start – sooner than you had expected – contemplating investing in a dedicated business car. Still, how can you narrow down the obviously broad choice of options?
How can you tell that you really need a business car?
Usefully, AllBusiness.com outlines three questions worth asking to edge yourself closer to an answer. Firstly, do you find yourself driving your existing car more for corporate purposes than such everyday tasks as the school run and visiting friends or relatives?
Secondly, if you do put your personal vehicle to business use, does it often seem too small for the job? For example, do you struggle to fit in equipment and goods you want to transport by road?
The third question is a simple matter of finances: would buying a new vehicle take away from cash flow necessary for expanding your business, adding to the payroll or purchasing equipment? Answering all of these questions can help you to determine if – and exactly what – to buy.
How would you use the vehicle?
The issue of storage space has already been raised here, but it bears emphasis if your company is in the service sector. In that case, you might want to periodically pick up ingredients, lend employees a car for getting home or set up your own catering service in a restaurant.
In any of these scenarios, a vehicle with a generously-sized rear storage space would come in useful, Small Business Forum observes. However, if your business is small and office-based, you might not need an overly large car. Therefore, you could go for something sleeker and, thus, likelier to impress clients who catch sight of it as you turn up outside their office.
Should you buy new or used?
If your business is somewhat cash-strapped, as is the case for many start-ups, it might seem an obvious decision to buy a used car. However, while used cars are indeed cheaper to buy upfront, they can also develop problems sooner than vehicles right off the factory production line.
Where preowned cars do shine is when it comes to the cost of insuring them. It’s a sobering statistic – but according to studies cited by Business Matters, insurance accounts for about 15% of the expense of having a car. You certainly don’t want to bleed cash when insuring your vehicle, then.
How, though, are car insurance premiums calculated? There’s no blanket system that applies across all insurers, but car parts are one issue. Some are pricy to replace, thereby potentially heightening what you pay for insurance. But having other, more safety-conscious components fitted, such as traction control and anti-lock brakes, may actually help to reduce premiums.
Another potential step for reducing what you are charged for insurance, is obtaining your policy through a firm that actually understands the needs of business car owners. That’s why you might look to compare deals for dedicated company-car insurance from trusted specialist providers.