Buying or leasing: Should you buy your IT infrastructure or pay monthly?

When working with an IT provider, you will frequently have the option of purchasing or leasing your hardware. In this blog, we discuss the advantages and disadvantages of buying and leasing, as well as which is best for your business.

Buying or leasing: Should you buy your IT infrastructure or pay monthly?

One of the most important aspects that contribute to how a business operates is its IT infrastructure, and having a strong infrastructure can heavily influence the way you work. It's very likely that you rely on your infrastructure far more than you realise. When working with an IT provider, you will frequently have the option of purchasing or leasing your hardware. Similar to buying or leasing a car, both has its pros and cons. Costs, flexibility, and business needs are just a few of the factors to consider when purchasing or leasing infrastructure. In this blog, we discuss the advantages and disadvantages of buying and leasing, as well as which is best for your business.

What is buying and leasing?

Leasing involves paying a fixed monthly fee for a set period of time. This means that the equipment does not belong to you, but it does allow you to make frequent hardware upgrades, allowing you to stay up to date with new technologies.

Purchasing, on the other hand, requires you to pay for the hardware outright. This results in higher initial costs, but once paid, you won't have to make any recurring payments, giving you better control over your finances.

Advantages and disadvantages of leasing:

The ability to easily replace and upgrade your hardware is one of the primary reasons why many businesses lease their IT infrastructure. When you lease a car, you'll always be driving the most recent models with the most advanced features. This is also true when leasing IT equipment. This makes it an excellent choice for companies that rely heavily on their IT infrastructure. This means they can easily replace their unreliable hardware, which can fail at any time and slow them down.

Another reason why many businesses choose to lease is to save money. Purchasing hardware necessitates a significant initial investment, which has an impact on your cashflow. Businesses that lease will have more control over their cashflow because of the consistent recurring payments that are made at the same time each month. This enables you to budget more effectively and make more informed financial decisions.

When you lease your hardware, you gain access to regular maintenance and support from the IT provider from which you leased the hardware. This means you'll have experts on hand to assist you with any hardware issues you may experience, as well as advice on how to optimise your infrastructure. This saves you time and money because you won't have to spend time troubleshooting and repairing the problem. It also gives you peace of mind that if your hardware fails, you can easily replace it or have experts repair it, reducing downtime. Furthermore, many IT providers will setup all your hardware and infrastructure to your requirements, allowing your team to begin working immediately.

While leasing offers short-term cost savings, you may end up spending more in the long run as the monthly payments add up. This may also result in you paying more for the hardware than the equipment's actual value.

Another reason leasing may not be the best option is if your company handles a lot of sensitive data. Even if you think you've deleted the data, it may not have been entirely removed, putting your company's sensitive information at risk.

Advantages and disadvantages of purchasing:

While purchasing your IT hardware outright may be more expensive in the short term, it may end up being less expensive in the long run due to the one-time purchase. You may also get more value for money because you won't have to pay a monthly fixed cost for a piece of hardware you've been using for a while.

Aside from the long-term costs, another advantage of purchasing is complete ownership of your equipment. This means you can customise and tailor the equipment however you want. You can also download software, modify it, and configure the hardware to meet your business objectives.

One of the reasons many businesses are hesitant to invest in IT infrastructure is the constant evolution of technology. When you buy your IT infrastructure, you're often stuck with the same hardware for a while. This means you may be missing out on using the latest features of newer devices to power your business.

When your hardware approaches its end of life, you’re required to appropriately dispose of this. When your hardware reaches the end of its useful life, you must dispose of it properly. This requires the use of an IT disposal service, for which you may be charged, resulting in additional costs. This is why many businesses prefer to lease because the IT provider handles the disposal of unused our outdated hardware.

What is best for your business?

If your company is on a tight budget but still looking for ways to improve its infrastructure, we recommend leasing. You can invest in your IT while keeping your budget in mind without having to pay high upfront costs. Leasing may also result in you paying less than if you purchased the hardware outright, allowing you to save more in the short and long term.

Another reason leasing may be preferable is if your company has a large amount of IT equipment but does not have the budget for an internal IT team to handle repairs and maintenance. Leasing allows you to take full advantage of your IT provider's expert support. You'll also be able to get advice and direction on how to improve your IT infrastructure in a way that aligns with your goals.

Many businesses have adopted the work-from-home or hybrid working system in today's working environment. This means that businesses must invest in both office IT equipment and equipment for those working from home, which can be very expensive. As a result, leasing is an excellent way to keep costs low while allowing employees to work from anywhere.

However, if your company prefers to modify its equipment to meet its ever-changing needs, purchasing rather than leasing is the better option. When you buy your hardware, you have complete control over its customisation without any limitations.

Owning the equipment also gives you a sense of security and eliminates the uncertainty associated with leasing. You won't have to worry about recurring payments in addition to your leasing contract. This means you no longer have to be concerned about damaged leased equipment, which could result in penalties.

Let us help you!

At Edmondson's IT Services, we provide businesses like yours with the option of purchasing or leasing IT equipment in accordance with your objectives and goals. If you're unsure about which path to take, our experts are always happy to talk about your company and what you want from your infrastructure. Get in touch today!

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