Unraveling the dilemma between leasing and buying office technology

Jul 12, 2024, 9:08 AM | Updated: Jul 15, 2024, 10:15 am

young male technician is repairing a printer at office...

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KSLTV.com

This article about leasing or buying office equipment is presented by Les Olson IT, Your Office Technology Partner.

Introduction

For business owners, there are many good reasons to lease equipment, as well as good reasons to buy. Often, copiers, printers, or surveillance cameras are leased while computers and other smaller tech items are purchased outright.

Many factors influence such decisions. In this article, we discuss the pros and cons of each method.

Leasing office technology

Leasing is similar to renting, where you make an agreement with a B2B company, usually for a set amount of time. Leasing allows you to procure new equipment as things get outdated, and companies often include maintenance in the contract.

Here are some advantages and disadvantages of using this method for office equipment.

Advantages of leasing

Lower cost upfront
Access to the latest technology
You can often deduct lease payments as a business expense
Flexibility in terms of equipment options
Leases generally cover maintenance and repairs

In addition, leasing can help you combat the higher costs of inflation. Leasing companies often offer an additional three months to your loan to help you spread out payments. So instead of 36 or 60-month leases, you’ll usually see 39 or 63-month loan terms.

Disadvantages of leasing

Higher long-term costs due to ongoing payments
No equity, since you don’t own the equipment
Lease terms may not fit business needs
May face penalties for late payments or breaking the lease

Bussiness man Hand press button on panel of printer, printer scanner laser office copy machine supplies start concept.

Photo: Adobe Stock

Purchasing office equipment

Purchasing office equipment may make sense for a business with an internal IT team that is invested in long-term solutions. Of course, this method has some pros and cons, which we break down below.

Advantages of buying

Full ownership over the equipment
Long-term cost savings if the tech has a long shelf life
Tax deductions available for purchased equipment
Control over maintenance
Potential for equipment resale
Warranties may cover malfunctions
Service contracts can be purchased after the manufacturer’s warranty expires and they cover the same items as if you were leasing

Disadvantages of buying

Higher cost upfront
Tech may prove obsolete over time
Responsibility over maintenance

Other factors to consider

Before you decide to lease or buy office equipment, analyze your business’s financial health and available capital. Depending on your business operations, consider the rate at which you will need to replace technology as it becomes obsolete.

Further, consider your business’s long-term goals and potential growth and scaling needs. It may be beneficial to consult with a CPA about the tax implications and accounting practices of one method over another.

Conclusion

Ultimately, each business has unique needs and goals, so there is no one-size-fits-all approach to buying or leasing office equipment. Carefully weigh these pros and cons to make an informed decision that best suits your growth and day-to-day operation.

Local IT companies like Les Olson have a large selection of hardware available to lease, such as printers, copiers, servers, surveillance cameras, and more. They also have software offerings that can be used as a SAAS (Software As A Service) model, which is similar to leasing. Contact them today to see what method would be best for your business.