Lease or Purchase Office Technology

Posted by: Nauticon Office Solutions Comments: 0

According to the Equipment Leasing and Finance Association, eight out of ten American businesses, from small operations to Fortune 100 companies, rely on leasing to acquire assets. They recognize that the value of their equipment comes from using it, not owning it.

Why lease a copier?

Build capital strength. Leasing lets you spread your payments over time. You’ll pay as you go, not upfront, freeing up capital for investment or other business expenses instead of tying it up in fixed assets.

Stay on the leading edge. Technology changes and you run the risk it will be outdated next year or even next month. With leasing, that risk is minimized. Depending on lease terms, when the lease expires, you can buy the equipment, trade it in for the latest technology, or simply walk away. With a lease, you’re protected from being locked into owning equipment that may not meet your future needs, or that is obsolete before you can fully depreciate it.

Respond quickly to your changing business needs. Leasing lets you respond nimbly as your business grows and changes. It also gives you the flexibility to move up to the newest releases, features, and functions as they become available.

Preserve your credit lines. With leasing, you’ll have a new source of credit for your needs today and tomorrow, while keeping your bank lines open for other uses.

Receive 100 percent financing. Leasing permits 100 percent financing. Lease terms can be matched with the useful life of the equipment. Unlike bank loans, no down payment is required and typically, no compensating balances. You can finance equipment cost, along with installation, maintenance, taxes, shipping charges, and even software.

Generate profits. As your business grows, you can reinvest the cash conserved by leasing. Grow your inventory or invest in a new marketing promotion—investments that can bring real profits to your business.

Stretch your budget. Capital budgets often won’t stretch to allow for an outright purchase, but your operating budget may easily accommodate a monthly payment. Leasing guarantees a fixed monthly lease payment for the length of the lease term, so it’s easy to forecast your equipment expenses and even obtain the equipment you hadn’t planned for.

Gain tax advantages. Leasing may offer key tax benefits that reduce the cost of obtaining equipment. Depending on your lease, you may be able to write off the entire monthly payment as an operating expense or capitalize on the outlay. Consult your tax advisor about your specific situation.

Why purchase a copier? 

It’s your property. Unlike leasing, you own the device and have full control of its life-cycle. There’s no lease agreement, and you are not tied to it for the term of a lease. 

Less expensive. It is almost always less expensive in the long run to purchase a device than it is to lease one. Companies that want to minimize the amount they pay in interest will usually opt for buying over leasing. 

Recoup investment. Even though a MFP is a depreciating asset, you can sell a used printer if it’s no longer needed, whereas you cannot sell a leased printer. 

No contracts. When a company purchases a MFP, it’s not locked into a contract with a leasing company. 

There are tax implications for both buying and leasing copiers. Copiers and printers are depreciating assets, which can be claimed on taxes, but many equipment leases can also be claimed. Both leased and owned printers fall under Section 179 deduction when companies file taxes, so it’s best to consult with your business’s accountant before making a final decision on whether to buy or lease.

Need more information?  Nauticon Office Solutions can help you choose the right solution for your business.