An online supermarket business has decided to lease delivery vehicles rather than purchase them - HSC - SSCE Business Studies - Question 11 - 2004 - Paper 1

The primary purpose of leasing delivery vehicles rather than purchasing them is to limit the capital costs of the business. By leasing, the supermarket can avoid the significant upfront expenses associated with purchasing vehicles, allowing them to allocate their capital resources towards other operational needs. Additionally, leasing offers flexibility and reduces the risk of asset depreciation, which is particularly advantageous for a business focused on maintaining cash flow and minimizing financial commitments.