Leasing a Copier or Multifunction Printer
What is a Copier Lease?
A copier lease is a long-term agreement that allows businesses to use a copier machine for a set period, typically several years, by paying a regular fee instead of purchasing the equipment outright. This arrangement helps businesses manage technology costs and stay updated with the latest equipment without significant upfront investment.
Benefits of Leasing a Copier
- Lower Upfront Costs - Instead of a large purchase price, businesses pay smaller, predictable monthly fees.
- Access to Current Technology - Lease agreements often allow for upgrades at the end of the term, ensuring businesses can use modern equipment.
- Predictable Budgeting - Lease payments are fixed for the term of the agreement, making it easier to forecast expenses.
- Maintenance and Service Included - Many leases include maintenance, repairs, and sometimes supplies, reducing unexpected costs and downtime.
- Potential Tax Advantages - Lease payments can often be treated as operating expenses and may be tax-deductible.
Lease Terms and Duration
Copier lease agreements typically range from 24 to 60 months. The length impacts the monthly payment - longer terms mean lower monthly costs but potentially higher overall costs.
The most common lease terms range from 36 to 60 months (3-5 years). When selecting a lease term, consider:
- Your anticipated print volume
- How quickly technology is evolving in your industry
- Your business budget constraints
Choosing the Right Lease Term
A business with high print volume might benefit from a robust machine on a longer lease. Conversely, a business that values having the latest features might prefer a shorter lease to facilitate more frequent upgrades.
End-of-Lease Options
When your lease term ends, you typically have four options:
- Return the Equipment - Send the copier back to the leasing company
- Purchase the Copier - Buy the machine at fair market value or a predetermined price
- Renew the Lease - Continue leasing the same equipment
- Upgrade to New Equipment - Start a new lease with newer technology
Important Considerations at Lease End
When reviewing your lease agreement, pay close attention to:
- Notification Period - The timeframe for notifying the leasing company of your decision
- Return Conditions - Requirements for the copier's condition upon return
- Purchase Price - How the price is determined if you choose to buy
- Automatic Renewal Clause - Whether the lease automatically renews without notification
Understanding Auto-Renewal Clauses
An auto-renewal clause automatically extends your lease for a specified period if you don't provide notice to terminate. These clauses require careful attention to avoid unexpected extensions.
Auto-Renewal Warning
Every lease has a termination clause. 90-120 days prior to your lease expiring, you need to send a Letter of Intent (LOI) to the leasing company if you plan to return the equipment. Without this notice, your lease may automatically renew for 90 days up to a year.
Leasing vs. Renting a Copier
While both options allow equipment use without purchasing, they serve different purposes:
| Feature | Leasing | Renting |
|---|---|---|
| Duration | Long-term (3-5 years) | Short-term (daily to monthly) |
| Flexibility | Less flexible; penalties for early termination | More flexible; ideal for temporary needs |
| Cost Structure | Lower monthly payments | Higher per-period cost |
| Best For | Businesses with consistent, long-term needs | Businesses with temporary or fluctuating needs |
Early Upgrade Offers: What You Need to Know
If you still have remaining months on your lease and your current vendor is trying to upgrade your equipment early, they are rolling your remaining payments into the new lease. Leases do not go away, and they do not "payoff" your remaining payments.
Important Advice
When offered an early upgrade, understand that you are financing the debt of your old copier into your new copier. It's generally better to finish the term of your lease before getting new equipment.
Common Misconceptions About Copier Leasing
Misconception: Leasing is always more expensive than buying
While total lease payments may exceed the purchase price, the value includes bundled services, predictable costs, and access to current technology, which can offer greater overall value for many businesses.
Misconception: All copier leases include maintenance and supplies
The inclusion of maintenance and supplies varies by lease agreement. Always review contract details to understand what's covered and what might incur additional charges.
Misconception: Longer leases always save money
While longer lease terms result in lower monthly payments, the total cost over the entire period may be higher than a shorter lease, and you'll be using older technology for a longer time.
Is Copier Leasing Right for Your Business?
Leasing is often ideal for businesses that:
- Want to preserve capital for other investments
- Need predictable monthly expenses
- Prefer access to the latest technology
- Want maintenance and service bundled into one payment
- Print enough volume to justify a business-grade machine
For very low volume users (under 700 pages monthly) or businesses uncertain about long-term needs, other options might be more appropriate.