What Are the Benefits of Leasing Office Printers and Multifunction Laser Copiers?
Whether you need a workgroup laser printer that doubles as a digital press, a wide-format inkjet or a plotter that can accommodate large CAD drawings, printing equipment can represent a big cash outlay for any business. Leasing instead of buying can help you improve your cash flow and still provide the devices you need to obtain and maintain a competitive advantage. As your hardware needs evolve, leasing can also make it easier to meet and manage. Source
Keep Equipment Fresh
Because equipment leases run for fixed periods of time, after which you typically return the used gear to the leasing company, you can plan your lease terms to coincide with the replacement cycle you want to maintain for your output hardware. Depending on the number of employees who will use a device, the volume it prints and the likelihood that you will either outgrow or outlast it, you can plan ahead for new technology and avoid falling behind improvements in equipment design or features.
Preserve Working Capital
When you lease a printer instead of buying it outright, you avoid the potentially large initial outlay of an equipment purchase. If you finance your acquisition with a bank loan, you'll be asked for a 10 to 20 percent down payment. A lease may stipulate payment of the first and last months' installments before the lease term begins, but it represents a much more modest upfront investment. Preserving your business capital enables you to devote your money to other needs, such as staff growth or expansion plans. Choosing a long lease term may reduce payment amounts at the literal expense of the increased total cost of ownership, however, as the sum of your payments can exceed the purchase price of the device.
Create a Fixed Cost
Leasing creates a fixed tax-deductible cost that avoids the need for complex depreciation schedules. Although deducting a purchase price as a lump sum may help you offset profits by a tidy sum, it produces a potentially uneven financial scenario, depending on how you schedule your depreciation. By comparison, lease payments become a monthly part of your bottom line. Note that leases that provide buyout clauses that enable you to purchase the equipment at a reduced cost at the end of the lease term may be subject to property tax, depending on how your local and state government structures its tax laws.
Should your business lease or buy equipment? The answer depends on your situation. Leasing equipment can be a good option for business owners who have limited capital or who need equipment that must be upgraded every few years, while purchasing equipment can be a better option for established businesses or for equipment that has a long usable life.
Each business is unique, however, and the decision to buy or lease business equipment must be made on a case-by-case basis. Here's a look at both options.
Leasing Equipment
Leasing business equipment and tools preserve capital and provide flexibility but may cost you more in the long run.
Advantages of Leasing Equipment
Less initial expense. The primary advantage of leasing business equipment is that it allows you to acquire assets with minimal initial expenditures. Because equipment leases rarely require a down payment, you can obtain the goods you need without significantly affecting your cash flow.
Tax-deductible. Lease payments can usually be deducted as business expenses on your tax return, reducing the net cost of your lease.
Flexible terms. Leases are usually easier to obtain and have more flexible terms than loans for buying equipment. This can be a significant advantage if you have bad credit or need to negotiate a longer payment plan to lower your costs.
Easier to upgrade equipment. Leasing allows businesses to address the problem of obsolescence. If you use your lease to obtain items that may be outdated in a short period of time, such as computers or other high-tech equipment, a lease passes the burden of obsolescence onto the lessor. You are free to lease new, higher-end equipment after your lease expires.
