Leasing a photocopier instead of purchasing is often cost-effective, smart decision for your business. There’re many advantages, including flexible payments and reduced upfront costs. If you decide that a photocopier lease is the right move for you, make sure you are asking the right questions from your vendor.
Most businesses prefer to lease copiers, enabling them to upgrade or replace their equipment with flexible payment terms, saving a lot of money on initial purchases.
Make sure that your business can make timely monthly payments for the duration of the lease contract, since copier leases are almost always impossible to breach, comparable to any other leasing contracts.
There’re 2 types of business equipment leases: capital leases and operating leases:
1. Operating leases
Most businesses like better operating leases since they present low monthly payments when weighed against capital leases. When businesses get operating leases for copy machines, they are basically renting the photocopiers, so the asset never gets added to the their balance sheet.
Generally, operating leases makes the most sense for businesses that don’t want the bother of owning copiers, and instead want to lease newer models.
2. Capital Leases
Capital leases are the least liked option for most businesses. When businesses get capital leases for office equipment, it is more like a loan on the cash than a rental on the photocopier, so the principal and interest paid goes toward the cost of the photocopier, and the photocopier goes on the lease’s balance sheet.
Generally, capital leases make the most sense for companies that want to purchase and own copy machines, but don’t want to make full purchases up front.
Benefits of Leasing a Copier
- Helps businesses better cash flows, budgets and funds
- Device is easily upgraded for a small fee
- There is the option of buying the copier after the end of the lease
- Cheaper than renting or buying outright
Drawbacks of Leasing a Photocopier
- Copier Lease contracts are rigid, so expect to sign a 3 year contract
- It is illegal to sell or deliberately damage the photocopier
What to Ask Before Leasing Office Equipment
Before leasing a copier, it is important to know what you are getting into. Ensure you’ve a firm grasp of the contract you are signing, and that you have chosen a reputable company to work with. If you have just started shopping around for leasing options, knowing the right questions to ask will help you make informed decisions:
Read Your Lease Before Signing It
Always ask to see a copy of the agreement before entering into a contract.
By studying the document before signing it, you might find a host of items that you never thought would be included in such an agreement. The most key things to look for are Automatic Renewal Clauses, Price Increase Clauses, End of Term Clauses and what your Lease includes.
Who Holds the Office Equipment Warranty?
It is important to know who holds the warranty on your leased photocopier. Is it the copy machine manufacturer or the vendor? If the copier requires routine maintenance or fails, who is responsible? Do you renegotiate your photocopier leasing rates if the copier needs to be replaced after failure?
What if I decide I want Different Office Equipment?
Let’s say you decide on a copier, but after using it in your business for several weeks, you decide it is not a good fit. What happens then? Can you trade in the office equipment for another, and at what cost? Find this out from your vendor.
What Happens When the Lease Expires?
Within the industry, customers are responsible to cover all of the costs associated with crating, packaging, and shipping the equipment back to the company after leasing a business photocopier. Shipping expenses can add up quick, and cost your business between £ 400 and £ 1600.
What Security Precautions Do You Include?
Many of today’s copy machines keep an image of every document that passes through them. You will want to know what happens to the hard drive and any data it contains at the end of your lease or rental agreement.
How Does Insurance Work?
Some vendors require that customers take the insurance plan that is offered by the third party leasing company. In the photocopier industry, the average is one-fourth percent monthly for the entire asset value.
On the flip side, it could be more beneficial to stick with your existing insurance policy if it’ll provide appropriate coverage. To avoid the extra charge, it’s to your business’ advantage to ask if you can use your own insurance plan. Also, make sure you ask what documentation is needed as proof of insurance.
As with any business partnership, it is important that both parties have a clear understanding of everything involved. Go for a company that offers a range of financing and leasing options, offering your business the flexibility of leasing coupled with the benefit of advanced printing technology.