Everything You Need to Know About a Copier Lease in 17 Minutes

We can start with the basics. And then we can go from there into some of how to save money and other things like that.

How to Acquire a Copier

So the first thing is a corporate lease is a way to acquire a copier. You can also purchase a copier. Lastly, you can also rent a copier, or you can lease a copier. 

And then on top of the leasing plan, you’ll have a supply and service plan, which will take care of the following:

• Ink
• Service
• Parts
• Labor
• Delivery
• and more.

So what we’re talking about here is the getting of the physical equipment into your office.

So getting, let’s say, for example, this Xerox CAD 30, and you want it in your office. This lease is a way to get that in there without putting $6,000 or $7,000 down, plus having a monthly payment of $130 to $150 a month.

How to Calculate Your Copier Lease Rate

The first thing to know is there are tables. When we’re making a copier sale, we’re looking at a table kind of like this:

Q2 Leasing Rates

A Fair Market Value lease means that at the end of the contract, the copier gets returned to a warehouse, and then you’ll be responsible for the shipment of the copier to that warehouse. You’ll complete your lease at the end of the term.

We also have a $1 Purchase option, which means at the end of the lease, you pay a dollar, and the copier now belongs to you.

You have different rates basically because, on the Fair Market Value lease, they’re giving the copier back, and there’ll be a value to that. The $1 Purchase Option lease lets you keep the copier, which is gets factored into the numbers on the table.

What you end up doing is you will take the amount that you’re financing. So let’s say it’s $7,000, and you are going to do a five-year lease. You would be in the $3k to $10k band right here. And so you multiply by 0.0195, And you would end up with about $136.50 on a fair market value lease.

On a dollar out lease, you would do the same thing. You go to the 60-month term, and you see “0.0208.” So you would go $7,000 x 0.0208, and that’s $145.60. So about $9 per month difference. And then $9 x 60 is $540, which is about what it costs to ship it back at the end, anyway.

So, I would tend to do the $1 Purchase Option because then I have an option to run it further afterward. If it’s still running great, I could sell it on Craigslist or use it as a backup.

Other people want to have the payment as low as possible. And they’re going to depend on the copier company to take care of that shipping fee, which will get rolled into the next lease, at the end of the contract.

So that’s two different ways to do a copier lease. And as you can see, there’s these different stairsteps. And so between $1 and $3,000 has a different lease rate factor than between $3,000 and $10,000.

So technically speaking, if we go $2,999 x 0.0235, and that would be $70.47. But if you go $3,000, so you just raise it $1, then that’s $58.50, so it’s $11.50 a month and almost $700 total. So that $1 difference in price makes a $700 total payment difference.

We try to focus on how we make sure that you’re in the right part of the stairsteps so that you can get the best rates possible.

Technically, it may mean adding a hundred dollars to your cost to ensure that your price goes down based on the lease rate factor.

Automatic Renewals

And the next you’d want to know is usually on any of these leases, towards the end of the lease, they have a clause that will do an automatic renewal. And so it’s always good to mark that into your calendar system that will let you know 60 or 90 days before the end of the lease.

You don’t want to automatically renew the year-long copier lease because you’ve already paid for the copier, and now you’re just basically giving the bank extra money.

So it’s pretty much always a bad deal to renew. If you do it a month or two, it’s not the end of the world. If you start doing it for a year, that’s just wasted $1,400 – $1,500.

So I like to have a reminder put into the calendar that lets me know on month 56 that we’re coming to the end of that lease. Ensure that you give the appropriate notifications because there’ll be a clause that says that if you don’t renew within a specific timeframe, you’ll have to keep it for maybe another three to twelve months depending on how it’s written.

Automatic Escalation Fees

One of the other things I try to look for within a lease is automatic escalations.

What an automatic escalation is, is it’s going to take the number like where we had here, $60 a month for that $3,000 copier, and it’s going to say, every year we have the right to raise the lease rate a particular percentage The standard percentage is somewhere around 10%.

So the $60 a month will go to $66, and then it’ll go $72, then $78, then $84. So by the time we hit $84 a month when the rep comes back around, it’s easier to say, “Hey, we can get you into another copier for just $60 a month, basically where you were though at the beginning.”

If you didn’t have that escalator, it would be harder to roll the next copier in because that escalation makes your lease payment higher each year. So I always would avoid escalation fees.

It’s easy for most copier companies to take that out of their contracts. We’d always recommend that when you lease a copier that you make sure you don’t have an escalation fee.

And be sure to mark down when the lease is supposed to expire.

Coverage Limitations

The next thing I would pay attention to is the idea of coverage limitations. That’s on the supplies and service agreement.

So, each copier is rated to do a certain number of pages per toner cartridge.

So if you think of it like each toner cartridges is like a gallon of milk. Each page comes out and expecting that you’re going to get so many cups of milk out of each gallon because a cup holds so much fluid, and you can multiply that out and determine how many cups of milk you’re going to get. They use the same kind of logic for pages.

So you have a toner cartridge, which has a bunch of toner in it. And each page that you print is going to utilize a certain amount of that toner. And it’s based on a recovery trait, and usually, that’s 5% per color. So the color is 20% because there’s four colors, cyan, magenta, yellow, and black. The black and whites 5% coverage is a typical industry average because it’s only black. There’s no cyan, magenta, or yellow to take into account.

What happens on some leases or some service plans is that if you exceed 5% or above 20% color coverage, then there can be a multiplier added to compensate for the toner usage. So if it turns out that you’re averaging 30% or 40% coverage, instead of 20%, your color rate can rise by 1.5 to 2 times. Check to see if there’s a penalty if you exceed a particular percentage within your coverage.

And so that’s something else that we look at and try to make sure that, you know, if you’re going to lease a copier that you’re paying attention to your coverage, or getting ideally a lease contract that does not have a penalty on color coverage.

What to Look For in Overage Charges

You also want to see what your overages are. Overages technically should be lower in price, not higher, if you exceed the base.

What will happen on a base is that you’ll get a certain number of prints.

So we can use an example of 10,000 prints. Let’s say they’re all black and white just to make it simple. And they’re a penny apiece, so it’s a hundred dollars a month, and you get 10,000 prints. And then once you exceed 10,000, you get billed per print for any that you do over 10,000. So if you do 11,000 prints, then the last thousand would be charged at the overage rate.

Often, I’ve seen that people will make the overage rate higher than the base rate, which doesn’t make sense because most of the service should be contained in the first part. And the overage should be cheaper because the service is already included in the base. And because the copier company is going to want to make sure that their service department is whole. So they’re going to make sure that the service is in there, no matter what. And then, once you exceed that base, the service part has been handled, more or less. 

Of course, the more prints to do, you will have more service calls. So there is more service expectation. So you would expect more service calls, but the cost is going to be lower because you don’t tend to find a one for one ratio there. And so if you’re at a penny per page for 10,000, we would expect that once you exceed 10,000, it should be nine-tenths of a penny or something like that. It shouldn’t be 1.2 cents after you hit the 10,000.

Keeping an eye on your base rate, then comparing it to the overage and making sure the overage is lower than your base is a good idea.

How Does a Zero Base Contract Save You Money?

I’ve noticed that a lot of customers are concerned about having zero base. Zero base would be ideal if I were buying a copier because then you’re just paying for what you’re using. You’re not paying for 10,000 prints and then only doing 5,000, and therefore your effective cost per print doubles. So I would always personally get a zero base contract unless I got a massive discount for the inclusions.

So if I went from $0.015 down to $0.01 and I was pretty sure that I was going to use 10,000 and it saved me half a penny per page, then, of course, that makes sense because I prefer to keep the $50 per month. If I wasn’t sure if I was going to do 10,000, there’s no way I would sign up for 10,000 pages because it’s like, they’ll do 3,000 in 1 month or 7,000. And in those months, I’m going to lose 7,000 pages that I purchased.

So I would always say whatever you think your minimum month is that you should do roughly 80% of that rather than signing up for your average because your average is going to fluctuate.

You’ll have some months that are higher than your average and some lower months. So, I would take my lowest month, and then multiply that by 80%. And I would use that as my base.

This way, I knew whatever I was doing, for example, if there’s a pandemic, like what we’re going through currently, and nobody’s working at the office, I’m not stuck paying for 10,000 pages a month while everybody’s gone.

So the idea is to pay for what you use, don’t pay for what you’re not using. And so that’s an essential thing also within your service contract.

Why Higher Copier Speed Isn’t Always Faster

One of the things that we see from some people is if they are looking at different products, what they’ll end up doing is getting, for example, a Xerox Altalink C8070 for $219 a month and 70 pages per minute because of speed.

And so one thing to be aware of is that sometimes these high-speed copiers, like the C8070, go 70 pages a minute when it’s fully warmed up, but it may take longer to warm up.

So, people will take a fast one because they want to go fast like this instead of a slower one. After all, they’re thinking 70 pages per minute is twice as fast as 35.

The one thing to be aware of is that many of these copiers producing 70 pages per minute, anything over 50, can often take longer to warm up. And then if it’s a small job, you’d go faster by having the smaller, more compact copier.

So it’s not always that the higher rated speed is the faster copier. One thing you need to look at is the warmup time because if you don’t factor in the warmup time, it could take 30 seconds to warm up in eight seconds for the other.

So you have 22 seconds of it being able to print, and most of your print jobs will be just a few pages. And so you could find that your day to day printing is slower by going with the faster copier.

It sounds kind of strange, but one thing to keep in mind is the more small jobs you have, the less that speed matters. The more long jobs you have, the more speed matters. If you’re doing 2,000 pages, you know, reports or 1,000-page reports, or even 200 page reports suddenly going 70 pages per minute, it starts making more sense because it takes three minutes to do that job instead of six on a 30 page per minute copier.

That’s something to keep in mind: the longer your jobs are, the more essential speed is. The shorter your jobs are, the less important speed becomes.

Duty Cycle Considerations

There are also duty cycle considerations. If it’s 10,000, 20,000 pages per month, you’re still probably going to want to go to a higher-end model just because of the print volume, not because of the speed requirements. So that’s another thing to consider.

I hope this was useful to you because you know that’s our goal here at Copy Lease Center is to provide great information to our clients. And so if you have any questions or concerns, please feel free to give us a call. We always work to get you a fair copier lease, and we’d love to chat with you. Thank you so much.

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Leasing a Xerox Copier

Are you looking to lease a Xerox copier? We have all of the Xerox copiers for lease for your business, both color and Black and White copiers – Letter/Legal and 11×17 copiers too.

Some of the common models we lease are: (For Basic Offices)

Xerox Versalink C7020, Xerox Versalink C7025, Xerox Versalink C7030, Xerox Versalink B7025, Xerox Versalink B7030 and Xerox Versalink B7035

For more robust offices, here are some of the common models:

Xerox Altalink C8030, Xerox Altalink C8035, Xerox Altalink C8045, Xerox Altalink C8055, Xerox Altalink C8070, Xerox Altalink B8045, Xerox Altalink B8055

And for the high end offices, we also have the Xerox Primelink C9065 and the Xerox Primelink C9070.

One of the things we work for, is to “right size” the copier for your office that makes the most sense for you.

With the Versalink series, these seem to be more for the smaller office with the lower print volumes. The Altalink series is more for a higher volume office. If you are thinking, “what is a higher volume office?” – I would say the Altalink series starts to make more sense when doing more than 1 box of paper per month.

If you are looking to lease a Xerox copier, we can help anywhere in the USA. We are able to walk through your options.

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Leasing a New Xerox Copier

Are you in the market for a new copier, maybe your lease is coming to the end of its term. You have to make a choice on a new copier in an uncertain market. Do you get something that worked for the past 5 years, or do you consider new items like remote working and working from home as part of the metric you use on a new copier lease.

If you have a C60 with fiery, does the next copier you get need to be as big as the C60 or does it need fiery and should it be $400 to $500 a month, or should you be looking at a C8030 with or without the fiery at half the price? Maybe the C8030 makes more sense in the short run, but in the long run, the C60 makes more sense.

It is a tricky time to be making long term committments. We understand the struggles you may be facing when looking at the short term fear and uncertainty and looking at the long term of when things return to some degree of “normal.”

We know different businesses have different needs, which is why we work hard to build solutions that match each business owners’ personal ambitions. We can do short term or long term contracts. We work with you to have the perfect solution. Maybe that means a rental to hold you over for now? We know solutions could wind up looking like a lot of different things.

If you need a copier and want to discuss your options, we are here to chat!

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How To Choose a Copier Dealer

First off, we are a copier dealer. We are going to slant this article based on our strengths and values. It should go without saying, but I wanted to say it anyway to help get this objection off the table.

So you are looking to lease or purchase a copier. You see all kinds of information online. In fact you get some quotes, then you have 7 copier reps who won’t leave you alone because it is important to get your business for all of the reps.

One rep tells you that Canon is the best, the next says they wouldn’t buy Canon because the interface is hard. Another tells you how great Xerox is, another seems to be super into Ricoh.

So I guess I will say it, in some ways, every copier manufacturer CAN make a good copier. They don’t always do it. But every brand has some solid models that do better than others. Some copiers break more than others. Some are harder to use than others. Some are easier. So when it comes down to it, if a lot of the copiers are in a range of being similar, how do you decide? Price? Reputation?

We believe that a Xerox copier set up correctly will generally outperform other brands also set up correctly in terms of efficiency. However, a Xerox set up poorly will function worse than other brands doing the same tasks if those were set up well.

So you need to think about who you plan to purchase or lease your next copier from.

Here are some items we would suggest you look at before signing a lease with a new copier company.

• No escalations – If you start at a penny and then it is .011 then .012 and by year 5 it is at .015 – it would have been better getting a copier at .012 the whole time.
• Cost to Ship Supplies – At $10 to $20 per shipment, if you are having to pay for your toners, then you are going to pay a lot more over the life of the copier.
• Great Support – When you chat with the team, do they know the products and seem to like what they do?
• Reputation – Have you checked online reviews and the BBB for reviews?
• Coverage Restrictions – What happens if you exceed 20% coverage for color, or 30%?

These are just a few of the items you should consider when looking for a copier leasing company. One who treats you fair in the long run deserves more business. That is how we feel. There is no need to trick people into bad deals because there is enough business in the world to do things correctly.

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Copier Leases in a Pandemic

We have chatted with some folks over the past couple of months who have copier leases that are way too expensive normally, and doubly so during a pandemic. What can you do if you have a copier lease that is $600 or $800 or $1400 a month like one that we saw?

First, before we go into the specifics, and this in not legal advice, it is merely industry information, let’s talk about what happens when you decide to lease a copier.

First, the dealer sets the price of the copier. For ease of numbers, let’s say the copier is a $10,000 copier – in the high middle of the road range. Once the dealer has this number, you will see a payment around $200 for 60 months or $300 for 36 months.

The client, you in this case, signs a document. The copier company orders from the manufacturer or distributor the copier you wanted. Let’s say their cost is $9000 on the deal leaving them $1000 in profit. So they order the copier and install the copier. You sign you got what you expected. The copier dealer pays the manufacturer and the the bank (leasing company) pays the dealership the $10,000.

So you are 9 months into your contract and coronavirus hits. You call your dealer because you realize you can’t afford the copier. Now you are expecting the dealer to take the copier and let you off the hook. But they can’t because if they do… they only made $1000 and the buyout at this timeframe will still be about $10,000 (the bank makes money to finance the copier) – so if they do this, they would lose $10,000.

Now that doesn’t work, so you try the bank and find they are as reluctant. Why? At $200 per month for 60 months – they stood to make $2000 over 5 years to finance the deal. So for them, it doesn’t make sense to be lenient because … remember, they paid the dealer the full amount of the copier when you got it.

So – if you get stuck with it you lose $8000. If the copier company takes it back, they lose $10,000 and if the bank says no worries, they lose $9000. Copier leases going bad isn’t good for anyone. This is the rub you are sensing when you call your dealer and the bank.

OK, So What Then?

If it was me, the ideal solution is finding someone who is willing to take over your lease and rather than have $8000 lost, maybe you lose $3000. In order for this to work, both the copier company and the leasing company would have to be OK with it. The copier company if they are doing a supplies and service plan (unless that can be cancelled without penalty) and the bank because they are the ones holding the note on the equipment.

It is hard, no matter how you slice it, and someone always loses big when a lease isn’t completed. So if you can, it is best to complete it.

It also shows the importance of getting the right lease in the first place. This example is something most companies can survive. But what if it is a $30,000 copier (at $600 per month) or a $50,000 copier ($1,000 a month)? This is when it gets exceptionally brutal.

A good conversation and understanding where the players all lose is good when you are trying to make a plan because then you can understand what to offer and what to try as you work with your suppliers rather than against them.

If you need help with a low cost copier lease or to go over your situation, let us know, we are here to help!

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Ready to Lease a Copier in 2020? What to Watch Out For!

We have had some clients come to us, desperate to leave their current copier situation. They have a lease they are completely upside down in and want to know what they can do to improve their situation. I want to address the question –

“What can we do if we want to get out of our copier lease?”

The problem you face when trying to get out of a copier lease is the items are essentially being financed by a bank and maintained, in general, by a local company. In a lot of ways this is like leasing a vehicle and getting an extended warranty through a local dealer.

The first thing to consider is the situation everyone is in. It will help you understand why you may be having trouble getting what you want, and why everyone feels a bit helpless in the situation.

The Bank:

A key player in the copier lease is the bank. The bank is the company who finances the copier so you can use it for the next five years. The part that is confusing to most people is even the manufacturer’s financing is not always owned by that manufacturer.

So, the bank is loaning money, expecting a return oon their investment and if you return the copier early without paying, for them all that is lost revenue and lost profit. If they let every frustrated user out of their copier lease, the current rates of 8 percent would go up to 20% or 30% interest. Part of the stubbornness is to ensure other clients can get competitive rates.

The Dealer:

The next entity you ,may try and get relief from is the dealer that sold you the copier. You are thinking, perhaps, this dealer I paid $10,000 to over the last 3 years, so it is their job. This is where you hit another hiccup. The dealer may have charged you $10,000, but if they charged that amount, they certainly didn’t make that amount. Most dealers run on about 15% margin, so this means of the $10,000 you paid, they made $1,500 and then sent the $8,500 to the manufacturer.

The dealer isn’t making a ton on your copier, and if they simply “let you out of the deal,” first they would have to pay the bank back (with interest) AND they would be stuck with the copier they probably ordered for you. They have no control over the production quality of the copier, so they generally will do all they can to make sure they are working, but generally will not feel responsible for a recurring issue with the copier since they didn’t make it.

The Manufacturer:

Next we get to the manufacturers. They are almost always, many multiple billion dollar entities who are trying to move a ton of boxes. They, in general train the field reps on the copiers, so they also do not always feel compelled to help. They will assume the servicing dealer is making a mistake and often by the time the manufacturer is involved, the situation is so dirty it is unrecoverable.

The Customer (You):

So here you are, you have a copier that is broken that the bank won’t let you out of because they simply loaned you money to have it, the dealer won’t accept a return because they have already invested a ton of hours to fix the issue and they only made 15% of what you spent. The manufacturer won’t help because they are saddled with multi-billion dollar logic and policies to protect the bottom line. Your copier is broken and everyone is pointing at someone else.

A maddening position many find themselves in.

Normal Resolution:

Most companies in this position, get the buyout numbers from the bank and then roll that payment into the next lease. But what if your situation is REALLY messy. For example, we are working with a client who has a huge mess on their hands. They have a copier that isn’t meeting their needs and is costing them an arm and both legs.

• 

The problem this client has is they signed up for a lease that was WAY too expensive and the bank is simply trying to make sure they don’t lose money when they give the buyout. To be clear, in this scenario, we cannot see where the bank had any part of the frustrations. The bank simply financed what the client and their dealer agreed to.

The dealer probably had to pay about $20,000 for the equipment, and it says there are 47 months to go. If the dealer were to take back the copier, they will have lost basically $20,000 – You would expect the number to be lower, but remember the bank adds interest. The client is asking the copier lease company to take back a 13 month old copier for the same price as a brand new copier and most clients will even say they are so unsatisfied there is no way they will keep working with the dealer.

As the owner of the copier company, what would you do? You have a copier that a client wants to return at the full rate, but it is a 13 month old copier. You may have cash flow troubles which makes $20,000 to be a bit too much. Maybe you are unable, even if you wanted to work with the client.

So does that mean the client should be stuck with the copier lease? All of these questions are hard to answer. We just wanted to help you understand why getting out of a copier lease may be harder than you expected.

The copier company you are working with will generally reach out to their manufacturer. Most good manufacturers will help. Maybe they will help with client training, maybe they will swap. Then generally understand the wisdom of making sure the enduser client is happy. Xerox had a program, for instance, they called the Total Satisfaction Guarantee which they have done away with, but with enough pushing you can normally get something done for the client.

When dealing with a situation where the copier is driving you nuts… our first step is to try your best to work with your dealer. Often because of their manufacturer relationship they can get things done for you. If you start the conversation as a war, often they are reduced to feeling like they cannot really make you happy and may not work as hard to solve the problem, but will start spouting the rules to you rather than looking for a cooperative solution to create a win/win for everyone. Of course, even if you do your side perfectly, it may not get you where you are trying to go.

If you feel we can help you out with a copier lease or helping you understand your current copier lease, we are here for you!

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Xerox Altalink vs Versalink

You may have gotten a quote or have seen reviews about the Xerox Altalink and Xerox Versalink products. This article is to help you know what you are getting (or not getting) with these products.

Color Copiers – Xerox Altalink Copiers

• Xerox Altalink C8030
• Xerox Altalink C8035
• Xerox Altalink C8045
• Xerox Altalink C8055
• Xerox Altalink C8070

These are color copiers which are in the same family. They look like this…

Xerox Altalink Color Copiers

Now, these copiers are more robust. They are great for departmental copiers and handle a nice workload. These copiers are ideal when you want a higher quality copier with good standard features (like 4 trays and Postscript.)

The Xerox Versalink is more what we would call a high quality “entry level” 11 x 17 color copier. Models included in this family are the following:

• Xerox Versalink C7020
• Xerox Versalink C7025
• Xerox Versalink C7030

Xerox Versalink Color Copier Series

The big disadvantage to the Xerox Versalink family from out of the box is there is no included Postscript and it starts as a single tray unit. The problem with it is when you add the C7030 for example, add the Postscript and then add 3 trays, you would probably be better off just getting the C8030 copier at that point for the small price difference.

The color quality of the Xerox Altalink copiers are much better than the Versalink copiers. The workload is better on the Altalink copiers. The price can be much cheaper on the Versalink copiers.

We would love to help you get a Xerox copier, if you are anywhere in the USA, please get a hold of us for a free quote!

A few more items on the copiers. The last 2 digits of the model specify the speed of the copier. So a C8030 color copier is 30 pages per minute. As an example. The color quality is normally about the same within a family. Once you get to the C8045 and faster, you get single pass scanning (meaning it goes through the scanner and can scan both the front and back of the paper on one pass.)

Either family can add add the Xerox Apps, so you will def want to make sure you take a moment to learn about the cool apps.

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