According to Matt Davies Stockton, it can become quite expensive to invest in office hardware such as computers for small to medium businesses. It is often better to rent or lease computer hardware since they usually yield a better return on investment. However, they also come with a few issues that you must be aware of if you are considering renting computer hardware for your business. Let’s look at the pros and cons of leasing computers for your business so that you can make a sound decision.
The pros of renting computer equipment for business:
1. Predictable monthly expense –
When you purchase or lease computer equipment, you are required to pay a predetermined monthly fee. As a result, you can easily predict the monthly expense of renting computer equipment. This can help you create a better operating budget for your business and allow you to address budget concerns more easily.
2. Improved flexibility –
In order to keep up with the competition, increase employee productivity, and reduce system problems, you have to use the latest computer hardware. However, the latest computer hardware is quite expensive, and it is not easy to replace old computer hardware with new ones if you own them.
Part of the reason is that you have to resell them to cover up the cost of the old hardware which can definitely be a challenge since most businesses would like to use the latest hardware. However, when renting computer hardware from a reputed service provider, there is no need to worry about your hardware going obsolete since they will offer you the option to choose the latest generation hardware.
3. Improved cash flow –
Good cash flow is important for any business but when you purchase new computer hardware, you would have to sink in a ton of money which can take a long time to recover. However, there is no need to pay for down payments when renting computer hardware. Thus, it helps to improve the cash flow of business.
The cons of renting computer equipment for business:
1. More expensive in the long term –
Generally, purchasing computer hardware is more expensive upfront but is a better investment in the long term. Plus, you would be eligible for tax-write-offs since they are considered a capital expense.
When renting a computer of similar hardware, you might or might not be eligible for tax deductions depending on the tax laws of the state or country.
2. You don’t own the equipment –
When you rent computers, you don’t own them which can make things complicated. For instance, you would be liable for any damage caused to the hardware when you are renting it for your business. Thus, if anything goes wrong even due to accidents, you will have to shell out more money. And, if you don’t, you can be held legally responsible.
Plus, since you don’t own the equipment, you don’t have the right to sell the equipment either. And, you still have to pay the rent when you don’t use the hardware.
Matt Davies Stockton suggests you carefully consider the pros and cons of renting computer hardware for your business before making a decision. If you have the money to invest, purchasing is a better option. However, if cash flow is a major concern, renting is the better option.