Business assets fall into three broad categories: tangible, intangible, and intellectual property. Depending on the asset type, you’ll have to decide whether you want to buy or lease assets for your business. The first step is figuring out which assets will help your business succeed, according to the US Small Business Administration.

Tangible assets — like buildings, vehicles, and equipment — are used for regular business activity and lose value over time. Things like printer paper, which get used up, typically don’t get counted as assets. Count tangible assets on your balance sheet as property or equipment.

Intangible assets are the things you can’t touch — like your business reputation, your brand, or your business partner’s influential network. You don’t list these on your balance sheet and it’s often difficult or impossible to sell them for cash. But they can still contribute to the overall value of your business.

Intellectual property is a type of intangible asset that includes trademarks, patents, logos, websites, domain names, and software. Intellectual property is often protected by copyright or trademark protection.

Once you’ve determined all the assets you need for your business, you can decide how you’d like to acquire them.

Buying equipment can be a good option if you have enough cash or credit available and you’re confident you’ll be using the assets for a long time.

Buying has benefits:
• You can claim depreciation on your taxes
• The lifetime cost to buy is usually less than leasing
• You can count it as an asset on your balance sheet

Buying also has disadvantages:
• Needs more cash or credit upfront
• Less opportunity to “test out” the asset
• You could be fully liable for maintenance and replacement

Buy with cash or credit

If you buy your assets with cash, you’ll own it in full right away. But it also means you’ll have less cash available to cover operating expenses. Make sure you’ve done your accounting homework, and that you can actually afford to pay with cash.

Loans can give you some of the same benefits of leases by distributing the total cost over a longer period. However, you’ll pay more in fees and interest than buying outright with cash.

You might be able to leverage lines of credit with your bank or look for other sources to get more funding for your business.