Woodworking is a craft—but it’s also a business. Whether you're running a small custom furniture shop, cabinet-making business, or large-scale millwork operation, one thing is clear: quality equipment is essential. From CNC routers and planers to dust collection systems and jointers, your tools define your efficiency and finish.
But buying woodworking equipment outright can drain your cash flow. That’s why many shop owners turn to equipment financing to grow their operations strategically. In this guide, we’ll break down exactly how woodworking businesses benefit from equipment financing, what types of tools you can finance, and how to get started.
Equipment financing is a type of business loan specifically used to purchase equipment. The equipment itself serves as collateral, making it easier to qualify and often faster to get approved than unsecured loans.
Key Features:
Financing up to 100% of the equipment cost
Fixed monthly payments over 1–7 years
No need to pay the full cost upfront
Equipment is yours to use—and usually own—right away
Woodworking tools aren't cheap. A CNC router can cost $10,000–$100,000, and a full shop setup might include:
Dust collection system: $5,000–$20,000
Edge banders and panel saws: $10,000+
Sanders, jointers, and planers: $2,000–$8,000 each
Spray booths or finishing equipment: $5,000–$50,000
Financing lets you acquire these tools without wiping out your working capital, allowing you to stay agile in your business.
Newer machines are faster, more accurate, and more automated. Financing enables you to:
Take on larger or more complex projects
Increase throughput without hiring more staff
Reduce human error and material waste
Example: Upgrading from a manual router to a CNC system can cut production time in half and allow for consistent, repeatable output.
Running a woodworking business involves ongoing costs:
Lumber, adhesives, and finishing materials
Employee wages
Rent or mortgage for your shop
Marketing and lead generation tools
With fixed monthly payments, you can plan your cash flow and avoid large one-time expenses that can disrupt operations.
Acquire essential tools quickly
Preserve cash for operational needs
Increase project capacity and revenue
Upgrade to safer, more efficient equipment
Take advantage of tax deductions
Improve product quality and consistency
Build business credit
Virtually all new and used woodworking machinery can be financed, including:
CNC routers
Table saws
Bandsaws and scroll saws
Lathes and tenoners
Dust collectors and air filtration systems
Spray booths
Sanders and polishers
Paint systems and drying racks
Biscuit joiners and mortisers
Edge banders and dowel machines
Pneumatic nailers and presses
CAD/CAM software
Laser engravers
Smart measurement and automation tools
💡 Tip: Even installation, delivery, and training costs can often be included in your financing plan.
Most lenders have straightforward criteria:
Minimum of 6–12 months in business
At least $50,000–$100,000 in annual revenue
620+ personal credit score is ideal
Better scores yield better interest rates and terms
Business bank statements
Equipment quotes or vendor invoices
Business license or registration
🛠️ Startups may still qualify with a co-signer or larger down payment.
| Feature | Equipment Financing | Equipment Leasing |
|---|---|---|
| Ownership | Usually own the equipment | Typically rent the equipment |
| Tax Benefits | Eligible for Section 179 | May deduct lease payments |
| Upfront Cost | May require down payment | Often little to none |
| Term | Fixed; 1–7 years | Flexible; short- or long-term |
| Best For | Long-term use | Short-term or rapidly changing tech |
Case Study: Redwood Custom Cabinets
Needed: $85,000 for a CNC router + edge bander
Financing: 5-year loan with fixed monthly payments
Result:
3x increase in output
Hired one assistant instead of three
Landed contracts with two local homebuilders
Takeaway: Equipment financing allowed them to scale without sacrificing cash flow or hiring more staff.
Thanks to Section 179 of the U.S. tax code, businesses can deduct the full purchase price of qualifying equipment (up to $1,220,000 in 2024) in the year it's placed in service—even if it's financed.
You finance a $60,000 edge bander
You deduct the full $60,000 from your taxable income
This can reduce your tax liability by $10,000–$20,000, depending on your tax rate
Always consult your tax advisor to maximize benefits.
IRS Section 179 Deduction Guide (opens in new tab)
Woodworking Network – Industry News (opens in new tab)
National Wood Flooring Association (opens in new tab)
From improving output and reducing labor to modernizing your shop floor, equipment financing helps woodworking businesses grow strategically and sustainably. Whether you're just starting or expanding your operation, financing puts better tools—and better opportunities—within reach.
Need Better Tools Without Breaking the Bank?
Explore affordable equipment financing options today or connect with our team to build a financing plan tailored to your woodworking business.