Copier Leasing - Traditional Rental, Month to Month or Rent to Own?

Businesses often choose to rent their copiers to avoid the large initial costs associated with purchasing them outright. But copier leasing is not just a one-size-fits-all solution, there are also options such as month-to-month and rent-to-own agreements that could benefit your business. Here is an overview of what these two options bring to the table.

Month-to-month agreements

Renting, also known as leasing copiers for a fixed term, usually between 24 and 72 months, is the industry standard and has several advantages over owning the machines outright, these include:

• Conserving cashflow
  Keep cash that would have been outlaid on a device within the business for growth or contingencies.
• More accurate budgeting
  Get a fixed, known cost each month
• Early upgrading
  In the event of needing to change or upgrade your equipment, this can be done far easier with a rental agreement
• Improved lifecycle management 
  Businesses can plan for their equipment upgrades as rental expiries are known and assets never enter the balance sheet

While these rental agreements allow you to use the latest models, a new, extremely popular  option has entered market. Businesses may now consider renting refurbished or remanufactured colour or black-and-white copiers on a month-to-month basis without the requirement for a long term fixed rental agreement.

These are the main differences between month-to-month and longer-term leases.

Cost

Since these copiers are remanufactured models, you can rent them at a significantly reduced price. However, the stringent remanufacturing and refurbishing specifications mean that they perform at almost the same levels as a newer model. Watch our remanufacturing process video here.

Swap-out warranty

When you use previously-owned models, it is natural to want complete peace of mind. Therefore, a comprehensive swap-out warranty is part of the deal. Any copier that doesn’t live up to expectations is swapped out quickly and easily. We keep over 500 units in warehouse ready for clients.

Flexibility

Month-to-month agreements are an excellent choice for businesses that are growing or changing. These rentals come with a 60-day notice period, so whenever the business requires a bigger or newer model, they can get it without being stuck in a long lease agreement.

Service level agreement

Month-to-month copier rentals feature the same service level agreement (SLA) as a longer-term contract. This frees the business up to focus on other things, leaving the professionals to take care of installation, callouts, toners, and drums.

Rent to own

Rent-to-own agreements usually run for between 24 and 48 months, after which the business takes full ownership of the copiers. The business can then continue to use them until the end of their useful life cycle, while the SLA remains in place.

While owning your equipment outright after a period can be valuable, there are several things a business must consider to ensure that this is the right option for them.

Product lifetime

The expected product lifetime is probably the most important consideration in a rent-to-own agreement. These agreements make sense where you purchase machinery that is likely to perform to specifications long after the rental agreement comes to an end. Printers generally have a useful lifetime of between 48 and 72 months.

Sometimes, it is possible to get another year’s worth of service from the printer, but the cost of the service level agreement increases with the age of the machine. Therefore, the business needs to weigh up whether using the machines for another year is worth the extra service costs.

On the plus side, it is possible to opt for a 24-month rent-to-own agreement, which means that the machines could easily provide another 24 months of service where you only pay for the SLA.

Some businesses are reliant on implementing the latest printer developments, such as printing from a mobile device, and would therefore need to opt for the latest models. However, if you are simply looking for a reliable printer, rent-to-own could be the best option.

It is usually not necessary for every printer in the office to be exactly the same. You may decide to own a few new models for heavy-duty printing and the latest technology, but also rent-to-own a number of printers. When you take ownership of these printers, they can be used to perform lighter tasks or even be moved to an employee’s home, where required.

Service level agreement

If you choose a rent-to-own agreement, it is important to check with the provider whether your SLA automatically transfers to the copiers once you take ownership of them. Good providers should offer this option as a seamless integration.

VAT

VAT on rent-to-own printers is structured differently to rental-only printers. In a rental agreement, you can pay the VAT on a monthly basis, but the moment you enter into a rent-to-own agreement, the VAT is payable upfront.

Technological improvements

Businesses may not want to take ownership of old equipment because of the rate of innovation standard to printers. In the three years of the rental agreement, newer-generation models will typically become available.

These machines may have improvements that have a positive impact on staff productivity and may therefore be more cost effective. Printers also become more energy efficient with each new release, offering more savings with each progression.

Option agreement

Many businesses are reluctant to enter into a rent-to-own agreement because they don’t know what their requirements, or the condition of the printers will be at the end of the agreement period.

In these instances, businesses can consider an option agreement, which is signed at the same time as the standard rental agreement.

An option agreement functions in the same manner as a call option on a listed share.

At the end of the rental period, you can apply to take ownership of the printers and pay a small nominal fee of R100.00 Excl. Vat.

This option provides the business with more control, as it can decide whether to take ownership of the printers when they have more information, and it may also be more beneficial in terms of VAT implications.

Let us make it easier

We often find that customers think they have a simple choice between purchasing and rental when it comes to office equipment. But they also need to weigh up month-to-month, rent-to-own, and option agreements. 

With such an array of choices, it may seem difficult to find the right leasing option for your business, but this is where we excel.

With decades of experience, we are experts in helping businesses find the best printer and copier solutions for their unique needs. We can talk about your requirements at 086 011 8101, [email protected], or fill out the contact form.

FAQs

What is a month to month printer rental and how does it work?

You can rent refurbished and remanufactured copiers at a lower rate than new ones, with contracts that run from month to month with a 60-day notice period. You can therefore easily upscale to new models when the business needs to.

How does rent to own work?

With a rent-to-own agreement, which usually runs for between 24 and 48 months, the business takes full ownership of the copiers under that agreement the moment it comes to an end. The service level agreement can be extended seamlessly to continue to cover the copiers beyond the initial agreement.

What is the difference between copier leasing and renting?

These two words can be used interchangeably. In South Africa, we normally talk about renting, while in the UK they tend to use the term leasing.