Keys to a successful business copier lease
If you are a business looking for a copier place, this is the spot to get a quote or to just simply learn a bunch about copier leasing. Grab your favorite coffee and we can help you understand some basic leasing questions.
Here are some of the most common questions we hear about a business copier lease:
What is a lease buyout and should I take the offer?
A copier buyout typically is set at a percentage of the copier’s initial cost, or FMV or Fair Market Value depending on your contract. Generally, we would recommend AGAINST taking the FMV offer as similar copiers on the used market will generally be a better deal.
If you had a capital lease or $1 Out, this would not be needed at all because you would own the copier at the end of the term. Normally, if you are inclined to take an offer to buy out a business copier lease, you would have been better off doing a $1 Out lease in the first place.
If you are using an operating lease (FMV), we would generally suggest you do not take the offer to buy out the lease.
Why do you charge a cost per print if I am leasing the copier?
The lease charge is for the office equipment itself. The cost per print helps pay for the toner and the maintenance of the office printer. Think of a car, there is a lease payment, but gas is still required if you want to drive. The cost per print normally covers the toner cost, drums, copier repair, fuser, maintenance kits, waste cartridges, etc. The charge is for the consumable items, not for the hardware itself.
Why do businesses lease copiers?
There are three basic reasons businesses lease copiers:
- Habit – it is how they have always done it and it is part of their normal budget they are used to.
- Cash Flow – If cash flow is low, leasing is nice because it allows a $10000 copier to be onsite for about $190 a month. This can be especially attractive for a small business that doesn’t have a ton of savings.
- Taxes – Some businesses are looking for ways to lessen their tax burdens, often leases can help solve this issue. Normally larger businesses are looking at the capital lease or the FMV like this, considering items like Section 179 for capital equipment.
Office technology is often purchased with a little different logic than a consumer would buy a printer for their home. The business has more moving parts and accounting as well as productivity and efficiency to consider.
How is a copier machine’s monthly charge computed?
It depends on how the copier lease contract is structured. Sometimes there will be a base rate with included prints, sometimes not. If a base is $40 with 1000 black and white pages included, it means even if you only print 1 page, you will get a $40 bill. You are paying for the first 1000 pages for $40. Then there is an overage amount, and this is multiplied by the number of prints. For example, if we use the above base etc and the client prints 1900 pages… The bill would look like this:
Base – 1000 prints included $40
Overage of 900*(.01 if overage prints were a penny a page) – $9
The total bill that month – $49
The office supplies have to be factored in as part of the equation to ensure the printer is not losing the dealer money. So they generally are separated and computed as a monthly charge based on a per print model rather than a buying of the supplies or cartridges model.
Should I wrap the service into the lease?
Generally no, because then the service costs have interest attached to them as part of the lease loan that was made. We feel you get the most flexible deal on the new copier when you have the supplies and service part of the agreement separate from the copier lease agreement itself.
What is a base rate?
A base rate is an amount charged by a copier company for maintenance of the copier. Sometimes it includes a predefined number of prints, sometimes it does not.
We supply copy machines/ printers to businesses all over the USA. If you have been thinking about leasing a copier, please give us a call today!
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