Pros of Leasing
- Upgrade equipment after each lease. One of the best parts of choosing to lease equipment is the versatility it affords you. Whenever the lease is up, you can either stick with the device, or choose to lease the newest version. This makes it much easier to keep up with your competitors by staying up to date with the current technology.
- Easier to budget for. Leasing makes it much easier to manage your company’s budget for the year. Rather than making a large one-time payment, you can spread out the financial impact and know exactly what you’re able to afford and what your payments will be.
- No down-payment. Another benefit of leasing is that you’re able to avoid the costly down-payments that typically come with leases in other industries. This allows you to not only be able to get the equipment you need more quickly, but to also already have money set aside for your first scheduled payment.
Cons of Leasing
- Paying more overall. This is one of the most obvious downsides of leasing. Each lease is different and comes with its own set of terms and conditions, length of lease, and cancellation fees. The trade off here is that while leasing affords you more versatility when it comes to upgrading your equipment and budgeting, you typically end up paying more in the long run than you would if you bought the device upfront. Before entering into a lease, be sure to read all of the terms and conditions. While no one looks forward to that lengthy read, it’s better than being surprised with hidden fees or clauses that will negatively impact your bottom line.
- Having to finish the lease even if you stop using the device. Another less than ideal condition of leasing is that it doesn’t benefit you when it comes to unexpected changes. If a change were to occur in your company and you find you no longer have a need or use for the device, you still have to finish out your lease. If you’re considering leasing, it’s important to be aware of this and make your decision accordingly.
- Maintenance schedules and insurance. Leasing equipment also means you’ll likely have to invest in insurance for the device, as well as keep to a predetermined maintenance schedule to ensure it’s in good condition to go to its next user when your lease is up. While this often doesn’t tend to be an issue, some leases require a high amount of maintenance and expensive insurance policies that may end up hurting you in the long run.
Pros of Buying
- No contracts. This is by far one of the best benefits of buying a device outright. You’re not tied to a contract if you find you no longer have a use for the device and are able to freely sell it for a profit and put the money towards purchasing your next device. You don’t have to worry about hidden fees or clauses; simply make the purchase and that’s the end of it, making for a hassle-free experience.
- Lower maintenance costs. Another benefit of not being locked into a contract is the freedom to decide for yourself what maintenance and insurance options to choose for your device. Some leases require you to do extra maintenance and have it serviced more often than is necessary, or purchase an insurance package that provides coverage for things you don’t really need or use. By purchasing a device, it puts you in control of those costs.
- Tax deductible. When tax season comes around, this is a great fringe benefit to consider. Leasing a device doesn’t qualify as an office expense that you can write off, but when you purchase a device, you can look forward to being able to submit it as a tax deductible item on your return.
Cons of Buying
- Having to buy upgraded equipment. This is the main shortcoming when it comes to purchasing your equipment. Inevitably, over time your device will undergo wear and tear, eventually becoming less of an asset and more of a financial burden. In addition, as technology advances, you’ll most likely find that a newer model of the same device provides a much higher level of efficiency and productivity. So if you do decide to purchase a device, make sure it’s one that will stand the test of time and be able to support your business needs for the long haul and not be tempted by the flashy advertisements for the newest model.
- Up front costs. While you save money in the long term when you buy a device, it doesn’t make that up-front cost any easier to accept, especially if you’re a small business who doesn’t have a lot of flexibility in your budget. On the other hand, the extended lease and overall increased cost can negatively impact your budget down the line. You’ll want to carefully weigh the costs and benefits of each when making your decision.
Make an Informed Decision
If you’re still having trouble deciding which route is the best choice for your business, consider getting an outside perspective from an expert. At The Digi Group, we have been the first stop for businesses in Oklahoma for almost 20 years. We are a certified partner with Xerox, Brother, Samsung, and HP, and offer full service, supplies, and equipment for lease or purchase. We also provide free assessments to business owners who are needing some advice on what would be the most financially responsible decision. We will meet with you and assess the current state of your equipment, analyze your production output and operation costs, and help you find the devices that will maximize your office’s efficiency while minimizing your bottom line. Contact us today at 405-603-3545 or request an assessment online.