There’s a myth in our industry. It says buy new or you’ll have a higher risk of breakdowns. This statement, in its base form is only used by those who have an intent to sell new. But, here’s some dispelling facts you might keep in mind when trying to decrease your office expenditures in technology.
90% of breakdowns in copiers is because of a failed consumable item. Ie, the drum, fuser, paper feed tires, etc. In over 26 years in this industry I can probably count on my hands the amount of times an actual motor failed. In previous years, those were very expensive too, upwards of hundreds if not thousands of dollars. In today’s world, motors are relatively inexpensive and much easier to replace.
The second item that would fail, which would be very costly is an electronic board. But with two very prominent companies in our industry that repair boards and offer a warranty equal to the warranty on a new board, this cost is also minimized greatly. Which brings us right back to our original statement. Consumables will account for over 90% of your breakdowns.
So let’s take an average purchase of a midrange machine and do a comparison. Then you tell me which one looks like the right strategy for your company.
New machine – 55 pages per minute with scan, print, fax, finisher/stapler. Everything else standard. – We’ll use a xerox WorkCentre 5955i for this comparison, just because it’s new enough where the technology, features and ability to get it new all currently exist simultaneously at the time of this article.
I’ll post the basic specs here so that you can get a feel for the machine itself.
|Xerox WorkCentre 5955 Specifications:|
Let’s suppose you do your research find the best price and you want to ensure your company’s protected. So you end up buying this at a sizeable discount of $18,500 and you put it under service contract for .075 per copy and make 10,000 copies a month. You lease the machine because you don’t want to outlay such a large capital expense in cash.
Here’s what that looks like: NEW MACHINE
Lease commitment using .0235 for 60 month lease – Total commitment not counting return obligations – $434.75 per month times 60 months – Lease matured, you will have paid – $26,085 and the machine will still not be yours. You are also liable for anywhere between $650 to $1,000 for making sure the machine is returned to the leasing company’s warehouse.
Service Agreement Cost – 10,000 copies a month x $.0075 per copy = $75 a month x 60 months = $4,500
Let’s just add up the basic costs associated with having a new copier for 5 years.
Lease = $26,085.00
Service = $4,500.00
TOTAL = $30,585
Used Machine with very low meter – price found on Ebay
Same xerox WorkCentre 5955i with options above:
New Machine Base Commitment: $30,585.00
Used Machine Base Commitment: $5,595.00
TOTAL difference in commitment: $24,990.00
Roughly, that’s at least 5 to 6 times the cost!
Here’s where my fellow dealers will tell you……You can’t put a price tag on “up-time”! I couldn’t agree more! They’ll tell you that a used machine will break down ten times more than a new machine. False! The data does not support that. In fact, the amount of breakdown failures is directly dependent on how the users operate and maintain the machine and how your support services company helps you maintain it. If the machine is breaking down more often, you need to change either the way you operate and care for the machine or, replace your support services company.
Find a dealer who buys used machines that are near perfect condition, super low meters, great low per call service and only purchases machines where ALL consumable items can be replaced without even needing a screwdriver. This eliminates unnecessary service calls, keeps your “up-time” at it’s maximum potential and saves you roughly 4 to 5 times the amount of money a commitment to new machines does.
All in all, they can dazzle you with the term “new”, create fear with ghost stories of breakdown costs and up-time, and even tell you this is what most businesses do. But what they cannot do, is show you how to beat the numbers I show above. It’s just not possible. I know because I’m the one who created this model and save my clients a lot of money!
You now have a choice. Continue doing what you’ve always done, or step into the light and realize this is one machine! Imagine if you did this across your entire company. 5, 15, 25 machines! Most of our clients have enjoyed savings on average of somewhere between 4 to 5 times the expenses found with commitments to new purchases.
Take the time to assess your own current commitments. Then, give us a call. We’ll show you how simple and easy it is to really save money with your current office technology requirements.