Owning a copy machine can be a financial burden for many small businesses. Aside from supply costs and maintenance fees, coming up with the initial capital to purchase the copier can stretch operational budgets beyond profitable limits. Copy machine leasing helps ease the up-front monetary investment and may provide many other attractive benefits.
Is Owning a Copier a Benefit vs Renting a Copier?
Copier – Capital
Small businesses seldom have unlimited capital at their disposal. Saving financial resources for exploring business opportunities and for making purchases that appreciate over time is far more important than investing in office technology that will only lose value. Avoiding big purchases like copy machines keeps bank lines of credit available for more significant business needs. Lease agreements may even include the cost of supplies, further reducing the initial payout.
By renting the copier the small business is not stuck with a financial contract for more than a year and if you need to upgrade your copier, it can be done without penalties.
Copier – Budgeting
Leasing a copier can alleviate budgeting concerns. Instead of making one large payment at the time of purchase, leasing a copier establishes a set schedule of much smaller payments, enabling you to better arrange financial resources. You may even choose the length and terms of your lease arrangement to offer the most payment flexibility. Changes in interest rates also do not affect the established payment amounts.
Copier – Taxes
Copier leasing provides a distinct tax advantage over copier purchasing. If you buy a copier, you may only deduct the machine’s depreciation, which is typically 40 percent of the purchasing price the first year and then 25 percent of the purchasing price in subsequent years. However, if you lease a copier, the lease payment is considered a pretax business expense, meaning you can deduct the entire payment each time it’s made.
Copier – Technology
Copier machines depreciate over time, losing value due to use and to the constant introduction of newer, better technology. If your business purchases a copier, you can only upgrade in technology by investing in another new machine. You would also need to get rid of the previous model, adding to your time expenditures. In contrast, most copier lease agreements have options to upgrade the copier at a predetermined date. Such lease arrangements enable your business to always be in line with the newest office technology. Avoiding obsolescence also means more efficient copying since newer machines have lower per-page costs. Efficiency translates to increased profit and a greater return on your lease investment.