So, you finally found the perfect copier for your small business - now comes deciding to buy or lease. Don’t worry, though! This guide is here to help you decide if it is better to buy or lease a copier.
Leasing a Copier
Leasing a copy machine involves working with a copier leasing company to source your equipment from them. You will sign a contract and pay a monthly fee for using the copier, but you will not retain ownership of the machine - instead, you just keep paying as you use it over time.
Here are the pros and cons of leasing a copier:
One of the main reasons so many businesses choose to lease their copy machines is that the upfront costs are much lower. The cost to purchase a printer that can handle a large usage volume and still process at high speeds is quite expensive.
In other words, leasing does not require you to spend a lot of money right away! Similarly, budgeting for this purchase is really easy - you can expect to pay the same amount every month.
Another benefit to leasing Is that you don't have to worry about your copy machine becoming obsolete. If you need to upgrade your copier, all you need to do is let your leasing company know, and they will give you the option to upgrade.
The upgrade options with the lease are also beneficial if your business is growing quickly. It doesn't make sense to purchase a printer only to need a larger one a year down the road because your business demand increased.
Finally, leasing a copy machine means that you're not responsible for maintaining it. If there is an issue with the printer or something that needs to be replaced, the copier leasing company is responsible for correcting it.
No option is perfect, and leasing has some disadvantages as well.
For instance, even though the upfront costs are lower, you may end up spending more in the long term. The lower the printer's cost, the less leasing makes sense since you might end up paying more than the machine is worth!
Another drawback you must consider when you lease a copier is that you are locked into a contract. Typically, these contracts have strict terms that limit your options as far as upgrading or canceling. Make sure you know what you're getting yourself into before you sign anything.
Buying a Copier
The other option is to buy a copier outright. This involves paying the full retail price for the machine upfront, and you have complete ownership of it.
Let's look at why this might make sense for your business, as well as when it might not:
As we mentioned above, a lease requires you to pay an ongoing monthly fee as long as you're using the copier. When you purchase it, you have to pay the entire price at once, but that means your cost is fixed, and you will not owe additional fees for using it.
This can be cheaper over the copier's lifetime, but make sure that you run the numbers to make sure the machine will last long enough for this to make sense.
Buying a copier also has several accounting benefits. For example, you can depreciate the cost of a printer over time. In other words, you do not have to take the entire expense in one period.
As a result, you may be able to recoup some of the initial expense if you sell it down the road - but remember that technology is constantly evolving, and you may not be able to get the same price you paid for it!
Similarly, the purchase of a copy machine is a business expense, which means you can deduct it on your tax return. This can reduce your overall tax liability and help your business retain more profit.
Another benefit of buying a copier is that you are not locked into a contract. That means you are not responsible for meeting the requirements of the leasing company and you get to choose how you maintain the printer.
There is a good chance that you can find a more affordable maintenance package outside of the leasing company, so not having a contract for this aspect can make sense too.
The most obvious disadvantage to buying a copier is that it's expensive. It's no secret that a top-of-the-line copying machine can cost you upwards of $5,000, so if your company doesn't have those budget dollars available, then this may not be a viable option.
Not only do you have to manage the substantial initial investment, but you will also be responsible for paying for maintenance costs out-of-pocket. Be sure to also think about replacement costs. If repairs become expensive or your company has outgrown the copy machine!
Although depreciating the asset over time is a benefit, there is no guarantee that the copier won't lose value quickly. This value loss could mean that you're unable to sell the machine and end up having to dispose of it.
Which is Better, Leasing or Buying?
So, what's the better choice? Should you lease or buy a new copier?
Unfortunately, there is no right or wrong answer to this question - it all depends on your unique business needs.
Start by looking at your budget. If you can't afford to pay the entire purchase price for a copier, then the decision is simple - you need to lease. If you can afford to do either, though, you can move on to the next consideration.
Think about how you would like the copy machine to be maintained. Would you prefer to pay out of pocket for repairs or paying an ongoing fee to ensure that everything is taken care of?
Also, consider how fast your business is growing. If you feel like you're going to outgrow the printer relatively soon, perhaps leasing is a better option before you commit to making a purchase. However, if you feel like your business needs have leveled off and you are ready to buy the asset, then you can move forward with purchasing the copier!
If you would like more information about buying or leasing copiers or are ready to begin, contact Advanced Office Products at (337) 477-3700 or by requesting a quote.