Leasing a photocopier
Leasing a photocopier is a great option for your business if you can’t afford to pay a significant capital outlay upfront to purchase one. Predictable monthly expenses will enable your business to budget more effectively. Leases rarely require a down payment, so you can acquire the latest, new photocopiers without tapping into your much-needed funds.
Before you lease a photocopier, it’s important to understand the total cost of ownership over the photocopier’s planned lifecycle to make an informed decision. This is the capital cost of the lease hire plus the total copy charge, minus other savings factors. When deciding to lease a photocopier, you must understand all current and future costs. Also, be careful to understand complex language around monthly copying minimums that may disguise higher costs in the future.
Photocopier pay per click charges
Many leases charge on a per-copy basis and may include monthly copying minimums. Service or copy charge is often referred to as "pay per click". In most cases this will cover any repairs and maintenance to the photocopier. Toner may be included in the contract, but other monthly consumables such as paper and staples would not be. Pay per click charges will also vary between photocopier make, model and volume.
Leasing will cost you more in the long run, but the main advantage of leasing a photocopier is manageable monthly payments, and 35% of respondents to the 2005 Equipment Leasing Association's (ELA) survey said this was leasing's second highest benefit. Some leases also allow you to terminate the contract and give the photocopier back if you can’t afford ongoing monthly payments. This offers even more financial flexibility for your business.
Current photocopiers and latest technology
Technology changes rapidly and photocopiers eventually become obsolete. Studies have shown that in today's market, photocopiers have a maximum life of five years. After this time frame photocopiers are no longer cost effective due to technological advances, and changing the machine for a newer model is recommended. With a lease, you pass the financial burden of outdated machines to the leasing company. After the lease expires, you're free to lease whatever equipment is newer, faster and cheaper. In fact, 65% of respondents to the ELA survey said that the option to have the latest equipment was leasing's number one perceived benefit. Some leases may even allow you to upgrade your photocopier as newer models become available.
Leasing a photocopier: The Benefits
- Predictable monthly expenses
- Pay nothing upfront
- Financial flexibility to walk away
- Upgrade options as technology changes
- Cost savings through improved efficiency in the office
- Keep up with your competitors more easily, without draining your financial resources
Leasing a photocopier: The Disadvantages
- More cost in the long run. Leasing a photocopier over a 5 year period would give a capital cost at around 20% higher than an outright purchase.
- You're obligated to keep paying even if you stop using the equipment. Certain lease terms may mean that you have to make payments for the entire lease period, even if you no longer need the equipment.
- Paperwork - leasing companies often ask for detailed, updated financial information. They may also ask how and where the leased equipment will be used. Also, lease terms can be complicated to negotiate. And if you don't negotiate properly, you could end up paying more than you should or receiving unfavourable terms.