Melanie, managing director of a New York City law firm, attended a training workshop on negotiating equipment leases at the Legal Administrators Association (ALA) 2010 Annual Conference in Boston. The session, titled Equipment Leasing: The Financial Implications in Small Print, gave attendees the clear story on equipment leasing and how to negotiate better leases.
Melanie shared her success story. He used four of the leasing and negotiating tips he learned in the shop and saved his law firm more than $ 14,436 on the rent of a single copier.
He began by asking the copier salesman questions. Why was he offering a 63-month lease term? Why is the payment $ 1,280 if this copier is not equipped with the bells and whistles of the company’s other digital copiers?
Melanie said that while she was in the shop she thought, “I can’t wait to go back to the office and read the rental agreement. I bet there are problems.”
4 ways to negotiate an equipment lease savings:
1. Automatic renewal: Melanie negotiated a six-month automatic renewal up to a month-to-month renewal provision.
2. Amount of payment: Melanie thought the payment was too high for such a simple copier and lowered it to $ 879 a month. The savings was $ 401 per month.
3. Maintenance: He also negotiated full maintenance at the monthly payment of $ 879. Maintenance was additional on some of the company’s copiers.
4. Rent only what you need: The vendor had recommended three copiers with speeds between 60 and 90 pages per minute. Melanie knew that the electrical capacity for the proposed copier area would not be compatible with the 90-page machine. He also knew that a 60-page unit would easily handle the volume of the planned project. It also avoided the cost of additional electrical wiring.
This is a smart law firm manager! She found and negotiated the lease issues, resulting in a savings of more than $ 14,436 in the cost of the lease. Her business benefited from a reduced leasing expense plus a 700% ROI by sending Melanie to the conference workshop, all in just two weeks!