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What are 4 Things to Know Before Signing a Copier Service Agreement? An Essential Business Primer.

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What do you know about a copier service agreement? What does your organization know about it? I’m sure that you, dear reader, are a very smart person, but wouldn’t it be nice to get the full description of a copier service agreement? The full lowdown on everything about it? In this post, you’ll get all the answers you ever wanted to your most pressing questions about copier service agreements.

1. A service agreement isn’t a copier lease

What are service agreements?

Industry guide Matt Lane discussed that copier service agreement consideration, and many others.

“Most copier service agreements,” he said, “are all-inclusive and consist of parts, service and support, toner and some kind of form of guarantees of response time and a loaner replacement guarantee.”

Note that a lease agreement is distinct from a service agreement. While the former is about equipment acquisition, the latter is about the service terms and conditions related to the equipment. 

So what’s in a service agreement?:

  1. Most include a guaranteed response time within which the company must arrive on site.
  2. A warranty or performance guarantee covering the hardware.
  3. A loaner period in which a customer receives loaned equipment for as long as the company can’t fix it.
    • Most authorized dealers and most original equipment manufacturer (OEM) branches have a no-charge loaner guarantee, according to which, “if equipment can’t be fixed in a certain amount of time, they’ll usually supply a loaner the next business day,” Lane said. 
  4. A service agreement can specify whether replacement parts and supplies are original OEM materials or third-party compatible materials.

2. Service agreements have unique features

Although not all service agreements are the same, many of them share some common aspects:

  • Coverage

Coverage is the percentage of ink (black-and-white or color) or toner covering each page that such supplies will yield. A service agreement can state the price of ink or toner when those supplies are being used to fill (up to) a certain percentage of a page. Check to see if your costs increase if your organization exceeds a certain fill percentage, emphasized Lane. 

  • Escalation

“Escalation,” Lane said, “normally refers to an annual increase in the cost of the service agreement.” It is best to review your service agreement and rates annually. 

  • Copy rates

Most service agreements determine their copy rate according to the standard letter paper size of 8.5” by 11”. So, organizations should be aware of higher copy rates for larger paper sizes, like 11” by 17” or larger.

  • Meter-based billing

Just like your monthly usage for utilities like your home’s water and electricity bills is measured by some sort of automated meter, most service agreements also charge customers per print or copy.

  • Allowance

Other service agreements feature a base price and allowance, much like cell phone plans have allowances for a certain amount of data usage. Ask your dealer if you can change your allowance as your needs change. 

Just like with other products, when you purchase in greater volumes, you normally receive a lower cost per copy than you would’ve received if you would’ve had an allowance with a lower number of monthly prints or copies.

3. Mind the details

Surprise! Little do some organizations know about the following features of copier service agreements:

  • Automated meter collection and toner

As previously mentioned, some service agreements automate not only the measurement of device usage, but also the measurement of toner levels.

  • May you use third-party consumables or parts? 

Under some service agreements, you won’t be able to get service from your servicing dealer if you use parts or supplies that aren’t from the servicing dealers. Also under some service agreements, if anyone other than your official servicing dealer performs any repairs or adjustments on the machine, then your dealer can end your service agreement and warranty coverage. 

  • What if a new company buys the business?

You usually can’t assign or transfer your service agreement without prior written consent from your servicing dealer.

4. Be a savvy customer

And finally, be a well-informed customer by being aware of the following:

  • Make sure the dealer can separate the two payments for you

A “lease agreement” should have a separate service agreement. A service agreement is essentially a two-way contract between the dealer and the customer in which the customer is obligated to pay for services that the dealer is obligated to provide. If either party fails to uphold its end of the agreement, then both parties enjoy certain rights based on the agreement. 

Without a distinct service agreement, the customer can have limited rights if the servicing dealer basically breaches the agreed-upon contract. Here are some good questions to ask about your next service agreement:

  • Even if the lease and service are on one payment, is there a sort of “pass-through” from the leasing company to the dealer?
  • Even if the lease and service are on one payment, what’s the breakdown of the total payment? How much is the lease, and how much is the service?   
  • Ask your servicing dealer if you can change your allowance as your needs change.
  • Friends don’t let friends move their machine

Although you may be tempted to move your organization’s large office equipment, just don’t do it. Most service agreements state that only the copier dealer can move it. If it breaks over the course of your move, you could be responsible for the cost of copier repair. 

Knowledge is power

As the saying goes, knowledge is power. Or perhaps more accurately, the application of knowledge is self-empowerment. That includes knowledge of your organization’s copier service agreement. Before you sign on the dotted line of its next such agreement, be sure to apply most (if not all) of the lessons you just learned in this article. Thank me later! 

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