A franking machine is a sophisticated piece of equipment that can save your business a significant amount of money and time. If you’re considering purchasing a machine it’s crucial that you view it as a long term investment. Although in principle all franking machines deliver the same function, there is actually far more variation in the market than many people realise. You need to be sure that the functionality and capacity of the franking machine you choose today will still be relevant to your business’ needs further down the line.
Advantages of Purchasing a Franking Machine
Acquiring an asset for your business
When you purchase a franking machine you are gaining an asset for your business that should continue to improve your operations and save you money on postal charges for years to come.
You buy a franking machine, you own it, end of story. That’s as complicated as it gets. By avoiding leasing arrangements you don’t have to enter into lengthy financial contracts that could become a problem further down the line.
No ongoing budget implications
A one off payment for your machine will always be the simpler option if it doesn’t impact your budget too significantly. You won’t need to factor in ongoing monthly payments.
Lower long term cost
If you enter a lease arrangement you will end up paying more for the machine in the long run. So if you can afford to pay out the full value of the machine now it may make more financial sense to do so.
Disadvantages of Purchasing a Franking Machine
Large bulk payment
Not every business has the funds to purchase a franking machine outright as they can cost anything from a few thousand to upwards of £20,000. Depending on the technology that your business requires you may be tempted to opt for a more basic machine in an effort to save money now. However, this is not a great long term plan as a machine that can’t cope with the volume of mail you’re producing is only going to develop faults and breakdowns.
Leasing offers a viable alternative for businesses without the bulk payment needed for purchase.
While purchasing a franking machine adds an asset to your business, it’s an asset that will depreciate in value over time.
Ongoing maintenance and repairs
A lease arrangement usually includes ongoing maintenance and technical support so if your machine breaks down you aren’t left with extra costs and inconvenience. When you purchase a machine you will be responsible for hiring someone and meeting the costs yourself.
Purchasing a franking machine means committing to a level of functionality for your business. But what if your business grows over time and the machine is no longer suitable? Some leasing arrangements include the option to upgrade your technology as needed.
Making the Right Choice for your Business
Purchase or Lease?
The choice between purchasing or leasing a franking machine may well come down to budget. If you can afford to buy a franking machine in one go then this will save money when compared to a leasing arrangement. It also avoids entering a lengthy financial contract.
On the other hand there are several benefits included with leasing that may be of interest even if you can afford to purchase outright. For example, a leasing arrangement usually includes maintenance and servicing costs as part of your payment and can even give you the flexibility to upgrade the machinery if your business’ needs change.
Choosing the right franking machine
What suits your business now may not do the trick in a few years time. This is particularly true if your business is newly established and likely to grow. Make sure you’re considering this when you’re estimating the volume capacity needed as putting too much strain on a low volume machine can be costly in the long term.
Do you need a machine that will print your logo and marketing messages on the envelope? Would your business benefit from a SMART machine that can calculate VAT rated services? Do you need automatic envelope sealing, feeding and stacking? How quickly does the machine need to be able to process mail items?
Optional features could include:
- Integrated postal scales
- Company logo printing
- Automatic envelope sealing / feeding / stacking
- PIN protection
- Internet reporting
- Label printing
- Multiple user accounts
- Multicolour printing
- Barcode scanning
- Touchscreen displays.
How much does a franking machine cost?
Buying a franking machine is likely to cost you between £3,000 to over £20,000. It is possible to purchase a very basic model for under £3,000 but it is unlikely it will include the functionality necessary for the average business.
|Average Items of Mail (per day)||Type of Franking Machine||Average Price*|
|Up to 30||Low volume||£995-£3,000|
|20 – 100||Mid volume||£3,000 – £8,500|
|100-1000s||High volume||£8500 – £21,500+|
Once you have purchased the machine you will need to factor in the following extra costs:
- Postal fees
- Re-crediting fees
- Consumables e.g. labels, ink.
*Intended as representative figures only. Actual quotes will vary.