Your business is ramping up and you’re getting requests for unique products that your current machinery can’t handle. Or maybe you’re a part of a small startup and you need to make sure every initial business move is the right one. It could even be that your current equipment is going downhill and you’re looking to make the right next move. Whatever the scenario, your decision whether to lease or buy an industrial wide format printer will come down to how you weigh the pros and cons of each option.
Leasing Pros
Leasing is definitely the quickest path to procurement. Financing involves a ton of paperwork and it can take weeks to even be approved by a bank. By leasing, you’ll avoid the hassle of waiting and can get your hands on a printer quickly so you can start producing products and making revenue.
You could also have more financial flexibility through this route. Many companies offer deferred payments at the beginning of a lease so you can get your printer up and running and gain profits before you begin paying the full bill each month. Some businesses can also arrange a seasonal payment structure where your rates are higher during your busy seasons and lower during off seasons.
Leasing Cons
The flexibility and ease of leasing your wide format printer is not without its disadvantages. Leasing rates can reach as high as 7 or 8%, possibly even higher if you have poor credit.
Now compare that to a typical 2% interest rate you could get from a bank for financing with great credit. The convenience of a quick lease could end up costing you a couple extra thousand dollars in the long run.
Purchasing Pros
With the purchasing option, you can do so in one of two ways:
Paying Cash
Never having to make a payment sounds amazing, right? If purchasing in cash upfront is an option, then you’ll be paying less in the long run and can avoid the interest rates that come with financing.
Financing
If you’re financing, you might be able to spend a little bit more since the payments will be spread out. With this option, you could end up with a much nicer piece of equipment.
Purchasing your printer may have an intimidating price tag at first, but the interest rate you receive from the bank could be a fraction of what it would be if you go with leasing. That means you’ll be paying less overall for the same piece of equipment and you’ll have full ownership at the end of your terms.
Purchasing Cons
Financing will take time to become approved through a bank, so actually getting the printer won’t be as quick as you may need it to be. It’s also unlikely that a bank will offer any flexible financing terms, making the commitment a non-negotiable one.
Advantages of Both
There’s a significant break from the taxman whether you lease or buy, as long as the equipment is considered a qualifying business purchase – meaning a benefit to your company. You can claim the full amount of the printer for the tax year during which you acquired the equipment. Plus, under Section 179 for tax deductions, the values for what you can claim have recently increased.
But keep in mind the most important benefit of all: you’ll have full access to a high quality, wide format, industrial inkjet printer that will take your business’ products and your customers’ expectations to the next level.
What Industry professionals Are Doing
“This is a great discussion on the options for buying large format equipment. As with all types of financing, the less you need the money, the easier it is to get!
I bought my first printer using my credit card, which was a way to get it fast and with no hassle. Over the years we have leased, financed and paid cash, depending on the cost of the machine and how much cash we had. Currently we keep a line of credit with the bank, and can dip into that when buying. “
– Jay Buckley, President, MegaPrint Inc.
It’s important to take a close look at your financial situation to make sure you select the route that makes the most sense for you. Regardless of your means for obtaining an industrial inkjet printer, the investment will make the world of difference for your products and your customers.
Let us know if we can answer any of your questions about financing and leasing, or in regards to a specific type of printer that would be best for you.
