Our previous article on the Top three worst excuses to avoid IT leasing exposed the most common excuses that we hear for not leasing IT gear from a policy point of view, but what about from a practical point of view? Are the reasons companies and SME’s give for not leasing really valid?
1. “Won’t it end up costing me more?”
No, monthly payments will pretty much always total up to more than the equipment costs to buy – but this is a very one-dimensional view. When it comes to business, the total paid doesn’t always equate to the total cost. Sounds like some weird quantum maths going on… However, when you take into account the differences in tax exemption between leasing and buying, the cost of upkeep and the expense of flogging your obsolete equipment on the secondary market, leasing tends to work out cheaper.
2. “It’s better to own my equipment”
Not true! Keeping in mind what’s best for business, the main problem is: What’s the real benefit of owning the equipment outright? In the knowledge that it will become out-dated in three years!
Intuition tells you that an asset owned is better than an asset borrowed, but in this case it is not true. In your industry, if you own the asset, the onus is on you to keep it in good working order and to shift it once it is redundant – a headache no one wants to deal with. Besides, do you have the technical expertise to refurbish the equipment for the secondary market or will it more likely end up in the skip? A Financial Services provider worth its salt will offer to buy your IT deadweight and dispose of your redundant hardware free-of-charge.
3. “I’d have less visibility over leased equipment”
Exactly the opposite! You are handing over the time-consuming and complex management and oversight to a supplier – but you see everything through one window, with IT leasing losing an overview is not the case. Software allows you to manage and keep track of your entire IT ecosystem, right down to the serial number and full spec of the PC, monitor and mobile device provided to an employee of the business. It allows IT managers to be the master of their own IT universe – tracking machine performance, updating schedules, usage, redundancy and so on.
4. “It is just another contract to manage”
Some services can consolidate and centralise all of your IT contracts and warranties with your various vendors.
5. “I thought going straight to the manufacturer would be cheaper?”
Manufacturers, such as Dell, do sometimes offer their own leasing contracts. It seems obvious that a lease direct from the manufacturer would be cheaper. However, in a more modestly sized supplier, there are actually fewer overheads and complex costings, which means a better price can be on the table over that of a manufacturer. You are free to choose any equipment you like, regardless of brand.