Leasing office equipment is a popular way to equip an office with modern, versatile and productive machines. When it comes to leasing a business class printer, there are some basic things that you need to know and pay close attention to. It may sound simplistic, but reading the lease agreement before signing it is the cause of most anguish with lessees. Too often, people sign up for leases without knowing, or fully understanding what they are getting into, and end up stuck in an agreement with no way out.<
Companies that lease equipment are not necessarily trying to take advantage here, since everything is laid out in black and white, the burden is on the person signing the agreement. If there is something that doesn't make sense or you disagree with, then don't sign off on the lease.
Consulting with an experienced and reputable office equipment supplier is a great way to get some understanding of the entire leasing process and what it means to your business.
Important Points Before Leasing A Business Class Printer
Get it in Writing
Never take anyone's word for anything, always get it in writing. Since you are bound to the agreement for several years, you cannot afford to make a costly error. Make sure to read the agreement before committing to services; simple, but often overlooked.
Service and Supplies
It is generally never a good idea to includes service and supplies in a lease. Often there is a minimum required number of prints. You cannot really control what your printer will generate on a monthly basis -- businesses have slow times and busy times and locking yourself to a minimum is not a good idea. The concept of including supplies and service affects the buyout option at the end of the lease as well. The buyout is a percentage of the lease cost, the lessee (you), will have options at the end of the lease to either buy out the equipment or return it. If your monthly payment is higher because you have included supplies and service in the lease agreement, then your buyout will be higher accordingly. Supplies and service, if you decide to contract it out, should always be separated from the equipment lease.
As the owner of your business, you are responsible for keeping your business solvent, not the leasing company. Ask questions about the lease, especially if the wording (which was drawn up by lawyers) isn't clear. For example; If the company is pushing the 'supplies and service' type of contract, ask them "If we aren't happy with the service, can we break the lease?", "What happens if we don't produce the minimum prints we are credited for? Is the unused portion rolled over?" Questions like this will usually leave a bewildered look on the rep's face. Other questions about the buyout options and your options to get out of the lease if you aren't happy with the performance of the machines are equally important.
There are 2 different buyout options in standard office equipment lease agreements: 10% Buyouts -- This is based upon 10% of the original amount financed. $1.00 Buyouts -- are exactly what they say, $1.00 Buyout at end of term. Generally, the 10% Buyout option will give you the lowest monthly payment and $1.00 Buyout Leases will have the highest monthly payment.
There are many other points to consider when deciding on the type of lease you need. Speaking with your tax professional is important, depending on the type of lease you end up signing your equipment is treated differently on you company's balance sheet and tax return.
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