Small businesses have many demands on their budgets, whether it’s needing to hire more people to grow or updating outdated technology to evolve. That’s why when it comes to upgrading office printers, copiers, and other imaging-related equipment, careful consideration is important in determining whether leasing or buying is the best approach.
There are certainly arguments to made for both, and there’s no one answer—only the choice that makes the best sense for your organization’s budget and needs. For example, with leasing you don’t have deal with the up-front costs, and may be able to more easily afford what you need by making monthly payments. In fact, the number of businesses that chose to lease equipment more than doubled between 2012 and 2016.
However, in some cases, buying is the better choice. As you approach your next technology investment, weigh the cost-benefits of each option based on your unique business requirements.
The advantages of leasing a printer
For growing businesses, leasing digital imaging equipment often makes a lot of sense. Doing so can help you:
Maintain cash flow. Small business cite lack of capital as the No. 1 challenge they face right now. You may have limited access to credit or prefer to maintain liquidity for other expenses, such as marketing or hiring. With a leased printer, you typically pay nothing up front and your monthly payments are predictable.
Tap into sophisticated technology. Modern printers are multi-functional tools that perform a host of critical document management functions. Leasing offers regular access to the latest printing technology that you might not otherwise be able to afford. That’s why it can be an especially good option for startups, whose printing needs to evolve to support marketing, packaging, and other important functions as their business grows.
Save on maintenance. With leasing, maintenance and repairs are usually factored into the agreement. If an office printer breaks or has issues due to normal wear and tear, the leasing company is typically in charge of fixing the equipment.
Printer leasing drawbacks
Even with the advantages, there are still a few considerations that SMBs should make when it comes to leasing printers. These include:
Paying more in the long run. With a lease, you’ll likely end up paying more for the equipment over the course of the period you use it than if you had purchased it outright. Plus, there’s no option to make up the cost by selling, as you don’t own the printer in the first place.
Contractual obligations. As with any contract, you are obligated by the lease terms to continue making your monthly payments for the life of the contract; even if you’re ready to make an upgrade, selling isn’t an option. This might be a deterrent for businesses that over- or under-estimate their printing needs.
The benefits of buying a digital printer
On the flip side, many SMBs consider buying their printers. This can be a great choice because it allows you to:
Pay less overall. If you purchase printing equipment outright, then you’ll most likely pay less overall than if you make monthly payments to lease equipment over the span of several years. Yes, you have to make a large purchase all at once, but you also own the technology. That means you can possibly sell it once you’re done using it and recoup some of your investment.
Potential tax benefits. Office equipment, such as printers, falls under Section 179 of the IRS code, which allows businesses to deduct the cost of newly purchased assets in the first year. Section 179 includes leased and purchased equipment, but purchased equipment could potentially grant you a bigger deduction.*
Purchasing printers outright can also have drawbacks such as:
Upfront costs.The expense of purchasing multiple office printers may be too much for some SMBs to manage. Those that require highly specialized printers may opt to lease rather than buy, because such machines cost thousands of dollars—and are expensive to maintain.
Outgrowing your technology. Today’s printers are highly sophisticated tools that help businesses better perform in a fast-changing digital workplace. With a purchased model, you may find that your business outgrows what you purchased or need a new type printer as business strategy evolves.
Deciding what’s best
The right decision for your business depends on a host of factors. To help determine whether to lease or buy printers, ask:
What are your company’s cash requirements in the near-term?
How many printers do you need?
Do you anticipate your printing needs to change?
Do you have staff who can help maintain/update equipment?
Take the time to contemplate the answers, and you’ll ensure that your business makes an investment in printing technology that works for now and long into the future.
Learn more about how Epson printers can help take your office printing needs to the next level.
*Epson and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.