Leasing and renting a photocopier are often wrongly lumped in as one and the same idea, but this is simply not the case. Each arrangement features very distinct differences, advantages and disadvantages as well as some ‘fine print’ that you need to be aware of.
Your final choice will come down to the unique needs of your business, but here are some of the main points you need to consider when making your choice.
Leasing a Photocopier
By entering into a photocopier lease you are committing to a long term financial agreement of between 12 – 60 months. You pay via monthly or quarterly instalments enabling you to spread the cost of the photocopier and avoid a bulk payment that can be unrealistic for some businesses. This method enables many companies to access technology that they simply could not afford if buying outright.
Leasing a photocopier enables you to manage your cash flow more effectively and also offers tax benefits, as you can deduct the payments as a business expense in every year of the contract. The payments are usually cheaper than those of rental agreements and you avoid the large upfront expense necessary when purchasing a machine.
Things to be aware of…
Long term contract
One of the main things to think about before committing to a leasing agreement is the length of the contract. You need to be confident that your business will be able to cover the payments for the duration of the contract as the commitment is binding. Even if your business no longer exists you will have to continue to make all the monthly payments. This is definitely something to consider seriously if you’re a new business.
Lease Hire or Lease Purchase?
You will need to confirm with the leasing company what will happen at the end of the contract in terms of ownership. In the case of a lease hire, they retain ownership of the machine and will take it away at the end of the contract. However, in a lease purchase you will be entitled to ownership of the machine when all the payments have been made.
Service & maintenance…what’s included?
Most photocopier leases will include a maintenance and service contract as part of your payment plan. This can include regular maintenance, repairs and even supplies such as toner. However, it’s worth pinpointing exactly what is included as some will only cover the labour and not the cost of any replacement parts that may be needed at some point. The payments for the service plan may be fixed or could be based on your monthly usage.
Technology Upgrade Fees
At some point during the term of the lease you may decide you’ve outgrown the photocopier you’re leasing, or that you could be adequately served by a cheaper machine. It is possible in some cases to upgrade to a more sophisticated machine with more capacity (or downgrade), but this is not always easy and usually incurs a fee. Renting offers far more flexibility when it comes to changing the machine as you can usually alter / cancel contracts with 30 days notice.
Is leasing right for your business?
It may be that leasing is not the best option for your business. If you are producing less than around 700 copies each month it may be that purchasing a relatively low cost desktop machine will be perfectly adequate. Also, if your photocopier usage fluctuates due to busy periods then renting will offer you shorter term access to a machine with no need for a lengthy financial commitment.
Renting a Photocopier
Renting a photocopier enables you hire a photocopier for a short term period which can be anything from a few days to a few months. You pay a monthly fee for as long as you need the machine and can end the agreement with as little as 30 days notice. Your monthly rental fee will be determined by the number of copies you will make each month as well as any consumables like toner.
By renting your photocopier you have the flexibility to upgrade or downgrade your machine with very little notice which is perfect for businesses which have fluctuating copy needs.
Things to be aware of…
Beware Cheap Quotes
When comparing photocopier rental quotes you need to be careful not to be seduced by extremely cheap ‘headline’ rates. While some providers may quote a low monthly fee, they may not have been explicit about a large upfront deposit needed to make these low fees possible. In addition, the rental fee may not include maintenance charges.
In addition to your monthly rental fee you will also be required to pay maintenance charges which are calculated on a ‘per copy’ basis. These may need to be paid every month regardless of your usage, so again it’s important to check the small print.
Is renting right for your business?
Rental fees tend to be higher than photocopier lease payments; if you are likely to need the machine for 12 months or more you may end up paying more than the machine is actually worth. Leasing payments are usually smaller so a 12 month leasing contract may be more cost effective.