Leasing vs. Buying Xerox 700

[short_stop4]

Ok, let me give a little background on the shop. I am trying to help my father-in-law with his buying/leasing decision. The shop has 3 lithographic offset machines right now. They are looking at aquiring a Xerox 700 to bring the costs down and reduce turnaround for some of the smaller jobs that come in.

I would estimate that they would use the digital printer for maybe 12,000 clicks per month at a maximum, which would be under 150,000 clicks per year. Over 5 years, that is less than 750,000 clicks total on the Xerox 700.

The leasing amount is 1368/month + 100 service fee + .05 per click

That 1368 over 60 months turns into over 82,000 in leasing fees, plus they want a "Fair Market Buyout" if we wanted to keep the machine past the 5 years. I estimate the fair market value to be 15-20% of current MSRP which totals to $15,000-20,000.

Leasing would cost around 100,000 total (including the "Fair Market Buyout") over the 5 years

I can buy the Xerox 700 for 71,000.. and still get the $100 service contract to maintain the machine


In my opinion, the Xerox would not be heavily used, which should extend the life of the machine. It should be able to easily cover the 750,000 clicks over the 5 years and do even more than that to earn us total profit after we are done paying on the machine.

Does this decision-making logic make sense for this company?

 

[mikeatlbc]

I believe you can get the $0.049 Color Click without the $100 service base it you lease the unit.

Also, what RIP and other options are included in that lease price? High-Cap, Finisher?

 

[short_stop4]

I believe you can get the $0.049 Color Click without the $100 service base it you lease the unit.

Also, what RIP and other options are included in that lease price? High-Cap, Finisher?

No, there is a $100 monthly service charge regardless or leasing or buying. The package includes:

- Xerox 700
- Creo RIP
- Single tray oversized high-capacity feeder
- Advanced finisher
- Xerox CX Print Server Powered by Creo
- Advanced color tools package for CX print server
- Creo color server stand for CX Print Server
- Fujifilm Technical Services Installation and Training

 

[msaeger]

I'm just a tech so my financial opinion doesn't mean much but if you are planning on doing a buy out at the end I don't see how it would be cheaper to lease. The leasing company has to be making money on it.

You would have to ask the sales rep what the contract pricing would be if you buy vs lease. I don't know if Xerox does their own leases or uses a 3rd party. If they do it themselves they may give you a cheaper price on the contract because they make it up on the lease.

I like it when people lease because they always have the new technology and get rid of the machines before they run them into the ground. People that buy usually keep stuff too long. I understand I don't want a car payment either but I can tell you the people with 3 year leases have the least problems.

 

[JJBenderLLC]

Lease...or go for a doc 240 or 250

Lease...or go for a doc 240 or 250

Hi, my name is BJ and I’m a digital printing consultant at my company, so here is some free advice:

If you’re going to purchase something with a large price tag (like a Xerox 700) you definitely want to lease, because in 5 years time the 700 will be obsolete anyways, and will be more trouble than its worth.

My real piece of advice though is this…there is no need at all to be purchasing such an expensive machine for a 12,000 click max per month! A docucolor 240 or 250 could easily handle your print jobs, and the quality would be just as good, AND it would only end up costing you about 14-15,000 dollars. That is an astronomical savings when you compare that to the Xerox 700.

Consider what I’ve said, and if you have any more questions feel free to give me a ring at 203-336-4034, and I’d be happy to answer your questions.

Best of luck,

BJ

 

[mikeatlbc]

Short_stop4, I'm incline to agree with BJ, leasing this unit is the way to go. Also look at the DC242-260. You can always look at a longer lease, say 66 to 72 months?

Lastly, it sounds like you are getting the unit from Fuji Xerox? You might want to conact Xerox Direct, Xerox Agent or dealer and pit them against eachother. This way the Price war you create will benefit you.

 

[X33]

Lease, don't buy.

Too much money for a technology that will be obsolete in a few years.

If you decide to lease it, do it directly with Xerox. Make sure your lease agreement reads Xerox Corporation; that way Xerox is the one holding the financial paperwork and will be able to negotiate upgrades in the future. If you are dealing with FUJIFILM, your lease is probably with a Financial Intermediary that doesn't care about your upgrade of machine's performance. They just want to collect your money.

Look at it as a Monthly Operating Cost; how much you could make vs how much you will spend monthly. Don't think too much about the cost, price, depreciation, volume for the next 5 years; it just complicates things.