Hi,
Im just starting out as a window cleaner at the beginning of the year using wfp. I have a deposit paid on a 2009 Citroen Dispatch with 46,000 miles costing £123 per month over 4 years.
Then a friend says im mad. Buy a new one as it will be best in the long run. It works out at £232 a month over 5 years for the same sort of van. I can buy a vivaro for the same price as well. It might be too big though. Im just worried as obviously it takes time to get customers.
What would be your advice,
Cheers,
Steve
Hi Steve
I have thought about your post and have come to the conclusion that only you will know whether this is the right thing you have done or not according to your circumstances.
Unfortunately we don't know the original price or the VAT situation or anything about the deal you have done. We also don't know which model Dispatch you have put a deposit down on. We know that you are paying £123 per month for 48 months, but don't know how much deposit you paid and we don't know the finance detail, ie is there a final payment at the end of the contract, etc? (I see a dealer in Driffield is looking for £7650 + VAT for a 2009 Dispatch 120 SWB with 40k on the clock.)
We also don't know how much work is available in Londonderry either.
So I would hope that you have done a "due diligence" study and have put together an action plan for the next few months on how you are going to build a successful business on the foundation you are laying now. I am a little concerned for your situation that a friend has made a comment that appears to have derailed your plan of action to get this business started. You need to be convinced that according to your vision, you are doing the right thing. (Nobody has a crystal ball that will tell them the future. This van maybe troublesome, it may be totally reliable. Just because you buy brand new doesn't guarantee peace of mind. A new van can also be a 'lemon'. If you are concerned, look at an extended warranty for your s/h van against major driveline failures - but tread carefully as these are written for max seller profitability.)
A good, reliable van is important and so is the WFP equipment you need to do your business. The extra money you would spend on a new van would be better spent of the right WFP equipment IMHO.
A lot of people started off using ladders as this is a way of getting a business going with very little expense. As with us, most of what we started with, ladders, squeege, applicator, bucket and cloths are still in use now we are WFP, although not to the same extent obviously.
Building a business takes time and so you need to be able to have some funds initially to 'tide you over'. The lower your startup and running costs initially, the quicker you business will become profitable.
In my personal observation, most non VAT registered businesses don't buy new vans. It's better for VAT registered companies to buy them though as they claim the VAT back. This means that when they sell them, VAT is still applicable on the sellers price as the vehicle is VAT qualifying. By far the majority of 3 year old vans are leasing returns and all qualify for VAT.