If you’ve been reading some of the articles on this blog, you’ve certainly learned a lot so far about the ins-and-outs of the copier industry: inkjets, laserjets, and multi-function copiers, oh my! But there’s likely one topic that likely still lingers on your mind and maybe even keeps you up at night. What does it cost to lease a copier?
In business and in life, money tends to be on a lot of people’s minds (and not without reason). So if the cost of your organization’s copier lease is on your mind, we here at ClearView Business Solutions want to help you learn. With more than half a decade of quality industry experience under our belt, we are well-equipped to provide you the information you need to make a well-informed decision about your organization’s next copier lease.
After reading this article, you will rest easy knowing what factors affect the price of a copier lease and what the market in general looks like for prospective copier lessees. Our goal with this article is that you’ll walk away and understand how you can save money on a copier lease for your business.
What factors affect the price of a copier lease?
Just as a copier lease contains many variables, many factors affect the price of a copier lease:
- Equipment out-cost
The out-cost of the equipment is the raw cost of the equipment for the manufacturer or dealer.
- Lease rate
There’s also the lease rate and lease term, which are closely related. The lease term affects the lease rate, which in turn affects the monthly payment. The copier lease amounts to the lease rate multiplied by the total out-cost of the equipment (plus service).
- Lease term
In shorter guaranteed lease terms, lease rates are higher, and so are monthly payments. The vast majority of equipment leases don’t go 80% to 90% of the full term. Most leases are 36-63 months and are renewed or upgraded around 36 to 48 months into the term.
- Paying to fulfill your current lease
A stream of payment or full buy-out cost could increase the cost of a copier lease. A “stream of payments” is an organization’s monthly lease payment multiplied by the term that would be its total stream of payment.
- The leasing company
The leasing company that is funding and servicing the lease will also affect the lease rate. Different leasing companies have different leasing rates according to different variables.
- Lease language
The wording of the lease is important. How the lease is structured can affect the expense category of your organization’s copier, and thus its tax classification. Companies of all sizes stand to benefit from the most financially-friendly tax filing status.
How much does an average copier lease cost?
On average in this industry, you can expect to see monthly leases priced from around $100 a month to $300-$400 a month.
When working with ClearView Business Solutions, a middle-of-the-road copier lease and service payment is $148. That consists of a funding amount of $6,300 multiplied by the lease rate of .0188, to get the new equipment payment of $118.44. Add to that the $30-service payment, for a total monthly payment of $148.44.
For ClearView customers, the monthly lease includes 2,000 black-and-white copies ($.01 per copy over the overage rate) and 200 color copies ($.05 per copy over the overage rate).
The standard office copier lease described above is for a Toshiba e-STUDIO3515AC with a three-drawer configuration, dual-scan document feeder (DSDF) and commercial-grade surge protection. With ClearView, the machine comes delivered and installed.
What kinds of copier leases are there?
There are two main kinds of leases: fair market value and capital ($1-out).
- Fair market value lease
With a fair market value lease, you make monthly payments on the equipment with the option to buy it for the residual value at the end of the lease. This is by far the most common office copier lease.
- Capital lease
With a capital lease, your organization initially owns the equipment while the leasing company retains a secured interest throughout the agreement. At the end of the lease, your organization takes ownership of the equipment for $1. A capital lease is usually more expensive than a fair market value lease. On average, the monthly lease for a capital lease is 10% more expensive per month. At any time over the course of a capital lease agreement, you could – depending on the terms and conditions – pay your remaining stream of payments to end the agreement. If you’re transitioning the business, it helps you to satisfy the lease, avoiding the expensive cost of a fair-market residual value.
What does the copier leasing market look like?
Now is perhaps a good a time as ever for your organization to lease a copier and/or similar office equipment.
As the new year approaches, the market for office copiers and managed print services is a lessee’s market. With record-low interest rates and attainable standards to get a lease, the economy is primed and ready for your organization to take advantage of the benefits of a copier lease. In a worse economy, with tighter guidelines and stricter lenders, leasing companies would make it more difficult for an organization to secure a copier lease. In such an economy, leasing companies would see organizations in some industries as riskier lessees than organizations from other industries. Generally speaking, lower-risk organizations are more likely to pay their debts on time. Organizations in lower-risk industries would be more likely to pay their debts on time compared to other industries. Now’s a good time for organizations to take advantage of flexibility in acquiring financing for office copiers.
It truly is currently a lessee’s market, especially for the savvy lessees who learn to empower themselves before doing business with a new or current copier dealer. The empowered lessee can ask all of the right questions to increase the transparency of the copier leasing process, saving you money over the course of your lease.
What are some copier leasing companies?
Besides a copier vendor, your organization will also need to work with a commercial equipment finance company like GreatAmerica Financial Services Corporation, headquartered in Cedar Rapids, Iowa. Organizations incorporated for less than two years and organizations with credit challenges should take a look at Massachusetts-based TimePayment. For a bank, why not check out Wells Fargo?
Businesses need to work with commercial equipment finance companies because these companies actually own the equipment. Like with a car lease, in a copier lease, the leasing company owns the copier, and the customer pays the leasing company (which pays the dealer). The vast majority of dealers work with a leasing company because leasing companies have the capital to buy the equipment, and provide a number of services to assist both the lessee and dealer.
Where can I lease a copier?
As the copier leasing industry enjoys some more prosperous times, so can your business. Although it’s too often under-appreciated, office equipment like copiers is integral to your organization’s success. Just think: Where would your organization be without its copier? How much less efficient would it be without this technology? How would you interact with your documents without it?
As you can tell, an office copier is more than worth the price of leasing it. If you lease it from ClearView, you’ll receive 24/7 service and technical support to go along with the equipment. ClearView’s industry-leading Toshiba copiers are versatile, efficient, powerful systems that can solve all of your organization’s document-based needs.