Two payment options reign supreme in the world of office equipment: Leasing and purchasing.
Which one is the better option for you?
As a long-time, local print vendor, we’ve dealt with the leasing vs. purchasing question in almost every sales interaction we’ve had and know firsthand the intricacies that go into each option.
While there are other acceptable forms of payment in the printer/copier industry, such as credit cards and personal financing, they will not be universal to all print providers or vendors.
Therefore, informing yourself of the two most common forms of payment in the office equipment sector is crucial to determining how you’re going to pay for your next machine.
We’re going to be using our industry expertise to provide you with the pros and cons of the two payment options, so you have a comprehensive overview of each to help determine the one that fits best with your budget.
2 Pros of Leasing a Printer
To kick things off, let’s start with three of the prominent pros of leasing a printer:
Breaks Total Cost into Monthly Payments
The obvious and most notable advantage of leasing a printer is it breaks down the total cost of the machine into more affordable monthly payments.
There’s no getting around it: Modern-day printers are expensive, with advanced multifunction printers (print, copy, scan and fax) and production-style printers ranging from $10,000-$100,000 in some instances.
Most businesses don’t have the budget or desire to pay out-of-pocket for an over $5,000 printer, which is why leasing tends to be the most common form of payment in the industry.
Easier to Budget for
Building off that last point, breaking down the total cost of a machine into monthly payments is easier to budget for with most companies since they won’t have to undertake a hefty short-term cost.
A lot of companies prefer to have the total cost broken down so they can budget for other matters that contribute more greatly to their revenue goals.
The affordability and budgetary relief leasing provides is why most consumers opt to choose it when the office machine they want runs over $5,000.
3 Cons of Leasing a Printer
Now that you’ve seen the pros, let’s give you the other side with the three cons to leasing a printer:
You Are in a Contract
Just like entering into a lease agreement for your apartment, a lease for your printer means you are in a contract, and there will be financial consequences if you need to break it.
If you need to get out of your lease before it expires, you will have to pay a cancellation fee, which is determined by the leasing company. There can also be extra early termination fees if you decide to break your lease agreement.
Before entering into a lease, make sure to evaluate your work environment and account for how many employees you have and may add in the future, so you avoid leasing a machine that is inadequate for your situation.
Interest Rates Do Apply
Another downside to leasing a printer is interest rates will apply, and they can be higher than what your personal bank or credit union would offer.
Because of interest rates, leasing a printer will be more expensive in the long run than purchasing one outright would be.
Must Meet Leasing Eligibility Requirements
To lease a machine, you must first meet the eligibility requirements for leasing to make sure you are eligible for the payment option.
Some vendors have a product pricing minimum you must meet to be approved for the leasing option.
For example, if a provider has a $1,000 minimum to lease a machine, that means the total cost of the printer you want to lease must be at least $1,000 to be eligible.
You also must also have prior credit approval to meet the lease eligibility requirements at certain vendors or providers.
3 Pros of Purchasing a Printer
We’ve looked at what leasing a printer entails, so let’s now shift our focus to the purchasing option, starting with the pros:
Save More Money in the Long Run
If you have the cash flow to purchase a printer upfront, you should do it every time, because although it will cost you more in the short term, it will save you more in the long run.
This is primarily because interest rates will not apply to you, and although you can still put your machine under a service contract, you won’t be required to have a service contract like you would in most lease agreements.
As you will see in the cons section of the purchasing option, though, many businesses don’t have the budget to drop thousands of dollars on a printer, and not including a service contract could be risky.
You Won’t Be Bound by a Contract
Being in a contract of any kind can be intimidating, so a notable advantage to purchasing a printer outright is you won’t be tied down to a contract like you would in a lease.
Because you won’t be under a contract, you won’t be confined to a certain time period and can choose when you want to upgrade or get rid of the machine.
You can still opt for a maintenance or service contract, if desired, but it will not be required under the purchasing option.
You Can Recoup Some of Your Investment
By purchasing your machine, you now become the sole owner of it, which means you can eventually sell it off when it is no longer needed for your office.
You shouldn’t expect a major return, though. Printers are a depreciating asset, and if you used the machine at a consistent volume for a long period of time, it would not yield a significant financial return for you.
3 Cons of Purchasing a Printer
Let’s now take a look at a few of the major cons to purchasing a printer outright:
Requires a Hefty Short-Term Cost
The ultimate disadvantage to choosing the purchasing option for your next printer is you have to pay for it in full upfront.
When you’re talking about machines that can run over $5,000, they’re very few businesses that can incur such a cost and still have adequate working capital left over.
It’s the reason why leasing is the option of choice for many consumers, even though purchasing would save you more in the long run.
Access to Automatic Toner and Service May Not Be Included
If you decide to purchase your printer, you will not be required to add a service contract with it, which means you may opt-out of paying for one.
This means you won’t have access to automatic shipments of toner, which, as discussed earlier, can lead you to overspend on supplies you don’t need.
Not including a service contract means you would also have to outsource printer repair work. Printer service technicians can charge more than $100 an hour, and if the issue with your machine is complex, that bill can become costly.
You would also have to pay for any parts you might need to replace with your machine.
It’s Harder to Find a Replacement Printer If Needed
Say your printer has an elaborate service issue or stops working altogether: Where do you get a replacement?
Under a lease agreement, you’re more likely to receive a solution for a temporary replacement from your provider if something happens to the machine that you were leasing, although this is not guaranteed.
While you can find a replacement in this scenario even if you choose the purchasing option, it will be more difficult to find a solution if you’re not working with a provider.
Should You Lease or Purchase Your Printer?
So, which option is best for you, leasing or purchasing?
The answer is entirely dependent on your situation but as a general rule, if you have the cash flow to purchase a printer upfront, you should do it because of the cost savings you will garner as a result of not paying interest fees.
However, most businesses do not have the budgetary capacity to purchase a printer outright, meaning the leasing option is more prevalent among print consumers because it breaks down the total cost of the machine into monthly payments.
As you can surmise from the article, there are pros and cons to both options and a lot will go into your decision-making process regarding how you’re going to pay for your office’s next machine.
Ask yourself this question before deciding: Can I afford to pay for a multi-thousand-dollar printer outright and still have enough working capital left over to sufficiently cover my other financial responsibilities?
If you answered yes to that question, you will likely want to purchase your machine. If you answered no, then leasing will likely be the most cost-effective option for you.
For more information on the cost of a printer, read these blogs:
Ready to Buy Your Next Printer?
At this point, you’ve probably found the machine you want for your workplace and are ready to finalize your plans to pay for it.
Our over 35 years in the industry and customer-first mindset provides us with the experience and outlook that can help as you look to buy your next office printer.
We specifically sell Xerox machines, and if the new printer you’re looking to invest in is Xerox-branded, we can provide you with the machine you’re wanting.
But we believe in trying to help all consumers, so if the machine you’re looking to buy is a different brand of printer, we can help refer you to someone that sells the particular brand you’re interested in.