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What you should know about computer leasing
Computer leasing is an efficient way for small businesses to acquire the right technology equipment and stay abreast with the ever changing and increasing pace of evolution in technology. From new startups to FTSE 100, computer leasing is used by businesses all over the world to acquire new technology solutions to offer different services to their clients. Computer leasing is often the best way for a business to go, while it builds up its disposable cash flow.
Benefits of Computer Leasing
Leasing computers or IT technologies such as tablets, computers, telecoms and servers allows businesses to improve on performance by getting the latest IT equipment without enough capital or an existing line of credit. It can also be said that computer leasing helps businesses obtain the latest IT solutions without compromising because of their cash flow. Computer leasing also protects business owners against IT obsolescence which can happen any time and which is also a major issue for computing and IT equipment. With computer leasing, businesses can get all benefits realized from using the right technologies, while paying for the equipment over its working life. In addition, leasing helps, businesses speed up their return on investment and delivers increased cost savings and profitability.
Points to Consider Before Opting for Computer Leasing
- Terms of the lease - if you want to opt for computer leasing, it is critical to do your homework in order to get favorable lease terms. In this case, consider the type of lease you will be required to sign (operating lease or capital lease) and identify features of each type of lease.
- Buyout option - before signing a computer lease agreement, find out where there is a buyout option. In most cases, leases have what is known as a fair market value (FMV) or a one dollar buyout option. Understand what buyout option you have and whether it is favorable for both parties.
- Lease duration - it is important to understand how long the lease will last before signing the lease agreement. Leases for most IT or computer equipment have a maximum duration of 48 months. Understand that the longer the lease period, the lower the monthly payments.
Sample Computer Leasing Rates
It should be understood that while leasing offers businesses a way of getting the latest IT equipment without compromising because of their cash flow, businesses will have to pay more money in the long run. In the end, computer leasing can be quite expensive than buying new computers. Rates for leasing computers or IT equipment vary.
In most cases, leasing IT equipment mostly depends on the price of that specific equipment. Some providers charge between 2% and 5% of the price of the equipment on a monthly basis. For example, if a business leases a computer worth $4,000, the business will be charged 4% of the computer's purchase price. This amounts to $160 per month. If leased for 3 years, this would bring the total cost for leasing the computer to $5,760.