Are you planning to get a new coffee machine but need to know whether to rent or buy it? We can help. This guide will discuss the benefits and downsides of buying and renting an office coffee machine, plus key factors to keep in mind when choosing between options.
As with any equipment, a coffee machine model will eventually become obsolete. Renting allows business owners and office facilities to hand over the financial downside of obsolescence to the coffee machine leasing company.
For instance, let’s say there’s a 12-month rental period on a coffee machine. After the rental period expires, rent a newer, cheaper, and faster model of the machine. Over 65% of respondents to a survey carried out by the equipment leasing association said that the main benefit of leasing is to have access to the latest equipment.
A rental period helps forecast monthly expenses for the office, allowing for more effective budgeting. Most Equipment Leasing Association survey respondents said this is the second-best benefit.
Since rental periods don’t usually require an upfront payment, business owners can acquire new machines with less initial payment.
Renting allows business owners and office facilities to take advantage of sophisticated technology that can be initially unaffordable. This helps ensure office staff are kept happy at work with the high-quality coffee machines without draining the financial resources of your business or facilities.
Ultimately, renting usually ends up being more expensive than buying. For example, a $1,000 coffee machine would cost more than $2,000 if rented for two years at $100 per month but only $1,000 if bought outright.
The payment may last for the entire renting period even if the machine is no longer in use, which may happen should the business or office facilities change.
Buying an office coffee machine is easy. The owner or the facilities manager decides what they need and purchases it. However, renting an office coffee machine requires paperwork because coffee machine leasing companies can usually request detailed financial information. They will also typically ask what settings you need and the required functionality of the office coffee machine. In addition, negotiating the rental period terms can be complicated. If you negotiate correctly, you could avoid ending up with unfavourable terms or even paying more than you should.
As with any equipment or appliance, the office coffee machine rental period usually requires that the equipment be maintained according to the company specifications, which can be expensive. The maintenance schedule is up to you when you purchase the machine outright.
A business may be required to spend thousands of dollars to install a high-quality coffee machine for its office and staff. As with any business decisions, opportunity cost needs to be considered. This large upfront payment could have been invested in advertising, marketing, or other aspects of business growth.
As mentioned previously, modern technology and equipment can quickly become outdated. An office or business may need to update its technology in certain areas every two years. As a result, you may be stuck with old equipment to sell, donate, or recycle.
If you’re planning to rent an office coffee machine, do your homework to get favourable terms. If you’re looking to rent an office coffee machine in Adelaide or South Australia, check out BizCup.
Still, have a few burning questions about buying or renting an office coffee machine.
Here are important questions to ask yourself before buying or renting your office coffee machine.
If yes, renting can be the right option as it enables you to switch machines if you think a new model will better suit your business or facilities.
If you have a favourite coffee machine brand, check the manufacturer’s purchase and rent-to-own options, as you will be happy with your choice of equipment. Ultimately, the amount of money you’re comfortable investing is the determining factor. A smaller office or facility that only has a small number of staff and guests should make a smart choice of renting to prevent high upfront financial investment.
On the other hand, larger offices and facilities may choose to get a machine outright because it has a higher probability of paying off in the long run. Although, at the end of the day, it ultimately depends on your preferences and financial situation.
Is it a capital or an operating rental period? A capital rental is more like a loan. In capital rental, the office coffee machine is considered an asset, and it comes with benefits like tax depreciation and risks like obsolescence of ownership. Capital rentals may last up to 5 years.
An operating rental agreement allows the leasing company to retain ownership, including for tax purposes; the machine is believed to be a monthly operating expense instead of a depreciable asset. This type of rental is the most popular among small offices and facilities because they’re short-term and don’t involve many funds.
Ideally, the rental period for equipment like office coffee machines can run within 24,36 or 48 months. A longer rental period can mean a low monthly payment, but It may also lead to a larger total payment over time with a longer rental period.
One of the requirements of most leasing companies is to insure the rented item. Not doing this may attract an extra fee to the monthly payment, which you could use to cover the insurance.