Determining the Cost of a Lease
You may have a copier lease and have wondered what the real cost of the copier is. This can be trickier when there is a supplies and service agreement attached to the copier lease. Let’s say your copier lease is $250 per month and you get 2000 black and white pages and 1000 color pages. What goes to the copier and what is for the service and then how does this compute to an actual cost?
If you are trying to work through this type of equation, you will have a lot better idea how to by the end of this article.
The first clues
You will get your first clue, in general, by looking at the overage costs. Let’s say you have that $250 payment, and it also says if you go over the 2000 black and white, additional copies are $.01 each. And on the color they are .07 each. Now you can take the (2000*.01= $20) + (1000*.07=$70) and assume $90 to $100 is for the service plan leaving $150 for the copier.
Now when you have the copier lease at $150, assuming it is a 5 year lease, you can divide that by .02 (a common lease rate factor) and you will get the amout of $7500. That is a rough idea of what the copier itself costs in this scenario.
Why complicate it?
You may wonder why the copier dealers make this complicated. Basically, we are in a position where all the deals are about the same and we want to be able to stay in business. You want us to stay in business too if you want a technician to come out when it is broken. The issue is if we said it is $7500, you would likely go to Amazon and see it for $6850 and then want us to match that price. Of course Amazon doesn’t have copier techs to help set it up or a local showroom to pay for (they have other costs, but their business model isn’t to be onsite and have to deal with physical products after being sold.)
If we did this everytime, we would generally be selling copiers at cost, and would be unable to have the technicians you need. So it works better to put in details Amazon doesn’t so you as a customer can’t compare it as an apples to apples for just the hardware while forgetting you will want more down the road.
We like being transparent, maybe to a fault. Hopefully this helps explain why things are confusing in this industry and hopefully you’ll appreciate our candor and give us a chance to help you with your next copier!