Should You Lease or Buy Tech Equipment?

When it comes to technology for your business, it’s easy to assume that buying is more cost-effective than leasing. After all, buying a home is a wiser investment than renting one because you build up equity and eventually own the property outright. However, this is where the difference lies, as do you really want to own today’s tech equipment a few years from now?

As the old saying goes

To quote the industrialist and billionaire J. Paul Getty: “If it appreciates, buy it. If it depreciates, lease it.” This savvy advice rings true to this day, as purchasing equipment that will depreciate in value is simply a waste of your hard-earned cash.

To put it another way, think about the desktop computers, laptops, smartphones and any other technology that you require in order to do business. All of these devices begin to lose their value as soon as they’re out of the box. As a result, buying technology will simply lead to your workplace being filled with clunky old hardware, all of which will have little to no resale value.

Achieve an excellent ROI

The key is to spend as efficiently as possible, which means leasing technology and saving on what could otherwise be enormous bills. Aside from this being cost-effective in the long run, it’s also much more affordable in the short term because the leasing contract will be set out as a manageable monthly sum.

When you lease, you have the latest equipment at your fingertips right away. As the world of technology advances, which occurs at an extremely fast rate, you can swap these devices for upgrades after an arranged period. This ensures a maximum return on investment, without any devices reaching the end of their useful life and simply being thrown away.

Meanwhile, all of the tech used in your workplace is the newest version, which enables higher levels of productivity, faster working and advanced digital security.

Free up your cash flow

As if all of the above isn’t enough reason to lease instead of buy, this approach also plays a major role in improving your cash flow. Even a very small business will require multiple devices, all of which come with a hefty price tag in the shops, so leasing helps to keep your bank balance strong and healthy.

Invest the savings into other areas

Taking Getty’s advice into account once again, the money that you save by leasing technology can then be invested into areas of your business that will appreciate in value. This could be ongoing training and continuous development plans for your staff, the buying of commercial premises that become a company asset, or any other activity that will pay for itself in terms of value.

What’s more, leasing all of your basic tech equipment also frees up cash that can be used to lease additional systems and resources. This could mean a whole new chapter for your business, enabling it to overcome obstacles, overtake competitors, and overshoot even your most ambitious sales targets.

Explore our finance services

For advice on how to make the most of your company’s cash and top recommendations regarding the leasing of tech equipment, call our friendly team today on 01482 223311.

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