Leasing v. Buying an ATM
TWhen it comes to leasing and buying, many people believe it’s always better to buy than to lease. But it’s not quite that simple; there is a lot more at play than just costs. It is true that, while leasing offers lower upfront costs, in the long run you spend more money. However, you must also consider maintenance and operation.
When you own an ATM, all of the repair and services are your responsibility, and so are the associated costs. When you lease an ATM, the provider handles any necessary maintenance, not only covering costs but ensuring that the work is completed by an experienced technician.
Really, if you’re trying to decide whether to lease or buy, the biggest factor to consider is how much use the ATM is really going to get. If your business has high foot traffic and you’re in an industry that primarily deals with cash purchases, buying an ATM might be the better option. But if cash purchases aren’t a huge portion of your overall sales and you don’t have a consistently high foot traffic, leasing is probably the best choice.
Get Free Price Quotes
Benefits to Leasing an ATM
There are several benefits to leasing an ATM, some of which include:
- Additional income: Each and every time your ATM is used, you make money. A portion of each convenience charge is yours and can either be put towards your monthly payment or your business.
- Low upfront costs: Rather than drop a large amount right off the bat, leasing lets you make a small down payment and spread the rest throughout the agreed upon time. Some companies even allow you to lease an ATM with no down payment. Payments on ATMs are tax deductible, which helps to reduce costs overall.
- Maintenance: The majority of lease agreements stipulate that the leasing company covers the cost of all maintenance and repairs. Rather than spend up to thousands of dollars on fixing the ATM yourself, the company sends someone else to do it.
- Testing: Leasing an ATM gives you the opportunity to see how one performs in your business. If you don’t find the investment to be worth it, at the end of the lease you simply send it back. But if it helps your business overall, you can extend the agreement. Many companies also offer a buyout option that lets you purchase the machine at the end of the lease.
How Much Does Leasing an ATM Cost?
The cost of leasing an ATM depends on the type of ATM, the length of the agreement, and the company you lease through. Here is a general pricing guide to provide an idea of what you can expect to pay when leasing an ATM:
- Leasing an ATM has an average cost between $50 and $120 per month.
- Installation and training fees have an average cost between $50 and $500. Some vendors waive these fees in favor of collecting a portion of the machine’s convenience charges, providing your business has high enough foot traffic.
Additional costs include:
- An ATM requires a phone line to run, which has an average cost between $20 and $40 per month.
- Replacing receipt paper has an average cost between $10 and $50 per month.
- Statement fees have an average cost between $10 and $30 per month.
- To keep the ATM stocked with cash, you’ll need to hire an armored truck service, which has an average cost between $100 and $500 per month, or a professional cash loading service, which has an average cost between $40 and $60 per month.
Downside of Leasing
While leasing does offer a host of benefits, there are downsides to leasing an ATM. You need to consider fraud threats and monitor your ATM for skimming devices, which steal card information from users. If there is little to no staff around your ATM most of the time, it is a prime target for fraud. If you do not own the property your ATM is on, leasing is probably not the best option in terms of liability.
Leasing an ATM gives you less control over surcharges and service scheduling. When you own the machine, you decide what the convenience fee is and pocket most of the income it brings in. It is also important that you thoroughly read through your lease agreement, as many have added costs, hidden fees, and service clauses.
Always consider all of your options before deciding whether to buy or lease. Every business is different, so you need to take all of your needs into account, and weigh them against the pros and cons of both options.