Financing Options For Glamping Pods
What’s the first thing that comes to mind when you think of buying a glamping pod? We could probably place a bet on it being ‘how much does it cost?’. The wide variety of glamping pod options means there is no definite answer, but we can say that you’re looking at at least £20,000.
The average glamping pod is usually between £20,000 - £25,000 but if you’re hoping for a bespoke pod, these are closer to £30,000. We know it sounds like a lot of money but the return on investment you can achieve with a glamping business is marvellous.
Why Finance Your Glamping Pods?
Financing a glamping pod means you can afford bespoke, high-end pods without having to pay all that money upfront. It’s the same principle as buying a luxury car that you can’t necessarily afford to buy right there and then. Instead, you pay a certain amount monthly or yearly, so you get the chance to drive the car you really wanted. Higher priced pods are much better quality and are likely to last longer, so it’s definitely worth the investment.
What Types of Financing Are Available?
The good news about financing a glamping pod is that there are plenty of options available. Picking the right form of finance for you does take a bit of research, so we interviewed our finance partner Ken, who’s helped us put together a short guide about financing glamping accommodation.
Hire Purchasing
Hire purchasing is one of the best ways to finance a glamping pod. Doing it this way means you can pay for the glamping pod in monthly instalments, with a fixed interest rate, and at the end of your payment term, you will be the owner of the glamping pod.
If the idea of paying so much a month for a few years, only to give the pod back again is unappealing to you, then hire purchase is the best option for you. Pay in instalments, then once it’s paid off, it’s yours to do with as you wish.
There are of course disadvantages to every finance option. The biggest disadvantage to hiring purchase, and something you will need to consider, is the very high interest rates.
Finance Leasing
Finance leasing can sound similar to hire purchasing but it’s actually quite different. Like hire purchase, with finance leasing you pay off the pod in a predetermined agreement of instalments for a certain period of time. But, with finance leasing, you won’t become the owner of the pod once the fixed term of payments has ended.
The way finance leasing works in the glamping world is a finance company will purchase the pod for you and you essentially rent it from them. One of the best things about finance leasing is the payments are treated as revenue, which means the expenses are tax-deductible. The other excellent benefit of finance leasing a glamping pod is that VAT is charged on a per payment basis, not on the entire purchase.
There are very few downsides to finance leasing but here are some things to consider. If you want to agree to a settlement earlier than the originally agreed term, you may face a costly final payment. Another thing to consider is owning the pod after the payments are over is much harder to do than if you go for hire purchasing. With finance leasing, if you really want to keep the glamping pod at the end, you’ll need to go through an experienced broker (and they don’t come cheap!)
What Do You Need to Apply?
Applying for financing is straightforward when you know what you’re doing and have everything you need.
What You’ll Need
Personal Information
Identification (passport and driving license) and utility bills
Company Accounts
Your most recent management accounts
Bank Statements
From the past 3 months
Business Plan
A written document that displays your overall business venture, costs, overheads and how sales will be delivered
Finance Pan
Your income and expenditure (This is where you can show your potential lender that you will be able to afford to pay them back)
What Enchanted Creations Offer
While we do know a thing or two about finance, we aren’t financial advisors. However, we know some reliable financial advisors that we can set you up with to get the best financial advice for your individual needs.
Finance Your Glamping Pods
There are multiple ways to finance your glamping pod(s), hire purchasing and finance leasing are amongst some of the best options when it comes to starting a glamping business.
If you’re still unsure about financing, feel free to get in touch with us and we can send you in the right direction.