Ask a tradie what a new work ute costs and you'll get the drive-away figure. Ask what it costs to have that ute earning, and the number moves. Racks, a canopy or a tub liner, drawers and shelving, a ladder rack, conduit tubes, a compressor mount, signage, a second set of keys, the tool transfer, the safety gear that lives in it, and two or three days where the old one is gone and the new one isn't set up yet. Fund the vehicle alone and you pay for the rest out of the same fortnight's takings — which is precisely the squeeze the borrowing was meant to prevent.
This guide covers how trade businesses fund the kit they run on — tools and battery platforms, specialist plant, trailers, and the vehicle plus its fit-out — and the two questions worth asking before any of it.
Cost the whole rig, not the rego papers
The sizing mistake is borrowing the quoted price of the asset. On a work vehicle the fit-out can add a serious amount again on top of the drive-away price, and it is the part that decides whether the vehicle is a van or a workshop. Racking that stops you unloading the whole tray to find one fitting is not a luxury; it is billable minutes back in your day.
The other line nobody costs is downtime. If the vehicle or the machine is off the road, the loss isn't the repair invoice — it's the days you can't get to site, the job that slips a fortnight, and the client who rings someone else. That cost is real, it just never appears on a quote. Work it out honestly before you decide the borrowing is too expensive, because idle days have a price too.
Our equipment funding page works through the sizing exercise in more detail, and the trade cash-flow shape behind all of it is covered on the business loans for tradies page.
Tools, battery platforms and plant a job demands
Tool spending splits into three fairly different decisions, and they don't all deserve the same answer.
- Consumable and replacement tools. A drill that's cooked, a dead laser level, a stolen trailer full of gear. These are usually small enough to come out of trading, unless several land at once or the theft cleaned you out.
- Battery platform commitment. Once a crew is on one brand's battery system, every later purchase is a skin and the platform is effectively locked in. Switching platforms across three vans is a genuine capital event, not a hardware run, and it's worth funding deliberately rather than in dribs over six months of receipts.
- Specialist plant a job demands. A core drill, a concrete saw, a mini excavator, a scissor lift, a compaction plate. The test here is simple arithmetic: what does the hire cost across the jobs you can realistically see, against owning it and having it available the day a client asks?
On that last point, be honest about hire. If you need the machine for one contract, hire it and put the cost in the quote. If you turn work away because you don't own it, or you're hiring the same item most months, ownership starts paying for itself — and that is a fundable purchase with a clear return behind it.
Asset finance or an unsecured business loan?
There are two honest routes for trade kit and they suit genuinely different purchases.
Asset finance — a chattel mortgage or a lease — secures the borrowing against the vehicle or machine itself. Because the financier holds security in something identifiable and resaleable, it is often the cheaper route, and for a new ute or a serious piece of plant it is frequently the better answer. Say that plainly: if you're buying a new dual cab from a dealer and you have time to arrange it, asset finance usually wins on cost. The trade-offs are that the financier has to approve the specific asset, older vehicles and private-sale purchases can be awkward or refused, the asset stays encumbered until the finance is paid out, and the fit-out generally falls outside what is funded because racks and signage aren't the asset.
An unsecured business loan works the other way round. The assessment is about your trading revenue rather than the item, so nothing is pledged against the vehicle or the tools, and the funds can cover the whole job — vehicle, fit-out, tools, signage, the lot — including second-hand and private-sale purchases that asset financiers often won't touch. Carrying that risk without security has a price: it usually costs more than secured asset finance, and a director's guarantee may still apply. Our guide on unsecured versus secured business loans pulls that comparison apart properly.
Smoko Finance is a business-finance referral service, not a lender. What happens instead is a referral: licensed Australian finance specialists arrange unsecured business finance of up to $200,000 for business purposes, subject to eligibility, assessment and lender approval, and the lender alone decides the outcome. If a chattel mortgage genuinely suits your purchase better, a good specialist will tell you so rather than sell you the other thing.
| Purchase | Typically better suited to | Why |
|---|---|---|
| New ute or van from a dealer | Asset finance | New, identifiable, resaleable asset — exactly what security is designed for |
| Fit-out: racks, canopy, shelving, signage | Unsecured | Mostly parts and labour rather than one securable asset |
| Second-hand ute from a private seller | Unsecured | Private-sale and older vehicles are often difficult for asset financiers to approve |
| Battery platform swap across the crew | Unsecured | Many small items, none worth securing individually |
| Mini excavator or major long-life plant | Asset finance | High value, long working life, strong resale market |
| Vehicle and fit-out together | Often both | Vehicle on asset finance, fit-out and tools on an unsecured facility |
Keep the old one running, or replace it?
Borrowing is not automatically the right answer, and a service that never says so isn't worth listening to.
Repair usually wins when the machine is fundamentally sound, parts are available, and the fault is a known one. Trade gear is built to be serviced; a set of brushes, a new chuck, a battery pack or a clutch on an otherwise good machine is rarely a replacement trigger. Repair stops winning when the bills turn from occasional into a monthly line, when parts are no longer made, or when the thing fails mid-job often enough that you've started building slack into your quotes to cover it.
Then apply the harder test. Does this purchase change what you can bill for? A second core drill so two crews can run at once, a trailer that lets you take the fencing job you keep declining, a van that gets an apprentice on the road as a second earner — each one has a countable answer and something to repay the borrowing with. A newer model of a tool you already own, in a nicer colour, with a marginally better trigger, does not change a single invoice you send. That is a want, and the till is the right place to fund it, not a loan.
What to have ready before you enquire
Trade applications move fastest when the picture is complete on day one, and none of it is exotic: your ABN and structure, the supplier or dealer quote, a realistic figure for the fit-out and installation, your last six months of business banking or secure read-only bank data, and details of any existing vehicle or equipment finance you already carry, because committed repayments shape what a lender will comfortably add. Being specific helps — "a $38,000 ute plus $9,000 of racking and signage" reads better than "a bit of a buffer". The documents page lists the full set, and the repayments page explains how these facilities are usually structured so you can sanity-check the cost against your own trading before you enquire.
If the gear is needed because work is already booked, our guide to getting a quick business loan covers how to avoid the delays that turn a matter of days into a matter of weeks. The enquiry itself is free, takes about two minutes, and is not an application for credit — a specialist calls you back, usually within one business day, to talk through the options for your business.
Frequently asked questions
Can a business loan cover the ute fit-out, not just the vehicle?
An unsecured business loan can, because it is not tied to a specific asset — the funds can cover racks, canopy, shelving, drawers, signage and the tool transfer alongside the vehicle. Asset finance generally funds only the vehicle itself, since the fit-out is not the securable asset. That gap is the main practical reason tradies use an unsecured facility for the fit-out even when the ute is financed separately.
Is asset finance or an unsecured loan better for a new work ute?
For a new or near-new ute bought through a dealer, asset finance is often the better answer: it is secured against the vehicle, so it is usually cheaper. An unsecured loan earns its place when the vehicle is second-hand or privately sold, when the fit-out matters as much as the ute, or when you need the whole job funded in one amount rather than one approval per asset.
Can I finance a second-hand ute bought from a private seller?
Usually through an unsecured business loan rather than asset finance. Because an unsecured facility is assessed on your trading revenue rather than the vehicle, it does not depend on a financier approving that specific car, which is what makes older and private-sale purchases difficult to fund conventionally. Any funding is subject to eligibility, assessment and lender approval, and the loan must be for business purposes.
Is it worth borrowing to switch the crew onto one battery platform?
It can be, if the switch is genuinely a capital event rather than a preference. Standardising batteries across several vans cuts dead time hunting for a charged pack and reduces the spares you carry. Fund it deliberately in one go rather than bleeding it through six months of receipts, but only if the current tools are actually holding the crew up — not simply because a newer platform exists.
How much can a trade business borrow for tools and vehicles?
For business purposes, unsecured finance of up to $200,000 may be available — subject to eligibility, assessment and lender approval. The practical ceiling for any particular trade business is set by its recent banking: monthly deposits over roughly six months, how long the ABN has been trading, and what vehicle or equipment finance is already being carried. Size the request to the whole job, not to the maximum available.