Xerox Lease End Options...

[kdw75]

We have a C75, which is basically an overflow/backup machine for our 2100, and our 6 year lease on it through Xerox will be up in a couple years. My plan has been to keep that machine when the lease is up, and pay for a supply, and maintenance agreement.

I see that at the end of the lease you have the option to buy it for fair market value, and I wonder how that is figured. Our machine has the OHC feeder, external RIP, booklet maker, and square fold trimmer, and will have about 4 million clicks on it. I am also wondering how much higher the click rate is on machines you aren't buying, I figure even if it goes up to 5-8 cents per click, that would still be fine, as we are not paying the lease price, though if they say FMV is tens of thousands of dollars, that would negate any savings from the missing lease payment.

It really seems like a poor deal, that you pay so much for the lease, and then still have to pay FMV, on some of our previous leases on presses, you would make your payments, then the lease buyout was only $1. More like a rent to own, that was still technically a lease.

 

[MailGuru]

IMHO, never a good idea to buy at the end of your lease, whether it is FMV or $1 buyout. You've beat the crap out of it for 6 years. Why would you want it?


If you're really wanting to go through with this, you need to nail down exactly what your maintenance/click charges are going to be on the C75, and, compare that to the click charges on a new 2100. Then, estimate your total monthly expenditure using your average monthly clicks.

When our Xerox 8002 lease ran out, we considered buying it. The FMV was around $20,000. We also did comparisons on a new V2100. Turns out that the click charge savings on the V2100 over what we would pay on the X8002 was enough to wipe out the monthly lease payment on the V2100, so, for us it was a no-brainer. Basically a new machine for free.

 

[pacart]

We just got a new machine, but we own our old one. What we did was had it written into our new contract that the old machine would only cost clicks, no minimum payment. This way we have a backup and a machine to put the smaller stuff on.

As for your FMV, it is my understanding that the lease company, not the service company controls that value. In our most recent round of talks while getting our new machine, I was told that FMV is typically around 10% of original lease/purchase price, but that isn't set in stone either.

As for the FMV or $1 buyout, we were given the option when we sign new contract, was that not an option for you?

 

[RickB]

With an FMV lease the buyout is negotiable. That's the most important this to consider. I work for Xerox and negotiate it for my clients frequently. Xerox would rather leave it in the field than have it removed.

 

[kdw75]

With an FMV lease the buyout is negotiable. That's the most important this to consider. I work for Xerox and negotiate it for my clients frequently. Xerox would rather leave it in the field than have it removed.

Hmmm.... Nothing set in stone, I just hate paying so much for a machine that only runs about 60K clicks a month. Our 2100 has a higher click charge than our C75, over a penny more on large sheets. The C75 has been a great machine, and it serves us well, so I just figured why not keep it around, and only pay for it, when it runs, rather than being a big monthly lug, just to have it sitting their as a backup machine. Again though, if buying it out costs 20 or 30 thousand, it may not be worth it for an old machine, with a higher click rate.

 

[RickB]

Hmmm.... Nothing set in stone, I just hate paying so much for a machine that only runs about 60K clicks a month. Our 2100 has a higher click charge than our C75, over a penny more on large sheets. The C75 has been a great machine, and it serves us well, so I just figured why not keep it around, and only pay for it, when it runs, rather than being a big monthly lug, just to have it sitting their as a backup machine. Again though, if buying it out costs 20 or 30 thousand, it may not be worth it for an old machine, with a higher click rate.

Ask for a formal buyout quote from your rep then make an offer of what you feel is worth it. The worst they can do is say no. But from my experience you can negotiate something much less.