Enterprise-level printing equipment costs hundreds of thousands of shillings. Leasing spreads that cost into manageable monthly payments. But is leasing actually the better financial decision? Let's examine both options honestly.

Understanding Printer Leasing

A printer lease is essentially a long-term rental agreement. You pay monthly fees for the use of equipment you don't own.

Operating lease: You use the equipment for the lease term, then return it. No ownership transfers. Payments are fully expensed.

Capital lease: Structured more like a purchase. At term end, you may own the equipment or buy it for a nominal fee. Recorded as an asset on your balance sheet.

Managed print services: Goes beyond equipment to include supplies, maintenance, and support. A complete outsourcing of your printing needs.

True Costs of Leasing

The obvious costs:

  • Monthly lease payments
  • Cost per page charges (often part of managed services)
  • Overage fees if you exceed page commitments

Hidden costs to watch:

  • Early termination penalties (often substantial)
  • Auto-renewal clauses that extend terms if you don't cancel in a specific window
  • Price escalation clauses that increase payments over time
  • End-of-lease charges for 'excessive wear'
  • Minimum page requirements you must pay for even if unused

Advantages of Leasing

Preserved capital: You don't tie up large sums in equipment. That capital can be used for revenue-generating investments.

Predictable expenses: Fixed monthly payments simplify budgeting. No surprise repair costs if maintenance is included.

Technology refresh: At lease end, you can upgrade to newer equipment. No obsolete machines accumulating.

Included service: Many leases bundle maintenance and support. One call solves problems without additional fees.

Tax treatment: Operating lease payments are typically fully deductible as business expenses.

Advantages of Buying

Lower total cost: Over the equipment's life, purchasing usually costs less than continuous leasing.

Ownership flexibility: Use the equipment as long as you want. Sell it, donate it, or keep using it beyond its expected life.

No contractual obligations: No minimum pages, no termination fees, no escalating rates.

Asset building: The equipment is a business asset with book value.

Provider flexibility: Choose any service provider for maintenance. You're not locked to the lessor.

When Leasing Makes Sense

  • Very high volume printing where included service provides significant value
  • Rapidly changing technology needs
  • Limited capital that's better deployed elsewhere
  • Short-term business needs or uncertainty about long-term requirements
  • When the full managed print service genuinely simplifies operations

When Buying Makes Sense

  • Moderate volume where managing your own supplies is straightforward
  • Stable, predictable printing needs
  • Available capital for outright purchase
  • Preference for ownership and control
  • Good access to independent service providers

The Calculation Framework

To compare properly:

  1. Get full lease terms in writing, including all fees and minimums
  2. Calculate total lease cost over 4-5 years (typical equipment lifespan)
  3. Get purchase price for equivalent equipment
  4. Estimate supplies and maintenance costs if purchased
  5. Compare the totals

Often, leasing costs 30-50% more than purchasing over the equipment's life. But if that premium buys you valuable service and convenience, it may still be the right choice.

Questions to Ask Leasing Companies

  • What is the total cost over the full term, including all fees?
  • What happens if I want to exit early?
  • What are the overage charges per page?
  • What is the minimum page commitment, and do unused pages roll over?
  • What is the process at lease end?
  • Are there automatic renewal clauses?
  • What does the maintenance agreement actually cover?

Our Perspective

At ilexDigital, we work with businesses on both owned and leased equipment. We provide maintenance and support regardless of how you acquired your printers. We can help you evaluate offers, understand terms, and make the decision that fits your situation. Contact us for unbiased advice on printer acquisition options.