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The Advantages and Disadvantages of Leasing a Franking Machine

The Advantages and Disadvantages of Leasing a Franking Machine

Franking machine rental is a good choice for businesses that would like to profit from Royal Mail’s price cut policy on franking machine prices, but don’t want to buy a franking machine outright because of the huge capital outlay.

If savings on the initial investment appear as an obvious advantage, there’re other benefits to the system, but also a few disadvantages that shouldn’t be overlooked:

What Exactly is a Franking Machine, Anyway?

Franking machines or postage meters are devices that print your business logo along with postage stamps on the postcards and envelopes. If you’re running your own business and there are many physical pieces of business mail to be sent on a daily basis, then this machine is an excellent choice for your business.

This device gives you a flexible and easy way to pay for postage on business mail. This proves to be the cheapest and fastest way of dealing with a bunch of business letters either on a daily basis or on a monthly basis.

Why Rent a Franking Machine?

A franking machine is a great money and time saving machine. That said, renting one is better than buying outright, as it can end up being a hefty expense, especially for small businesses.

Things To Be on The Look Out For

Negotiate, negotiate, negotiate. Suppliers compete hard for your business and if you push, they’ll give special offers to get you on board.

Think carefully before entering into a long-term contract you can’t just easily terminate. Some suppliers don’t allow it while some will ask you to pay termination fees.

Without further ado…

Franking Machine Rental Benefits

Initial investment

A long-lasting franking machine comes with a high price tag, which interested parties only find out after they’ve received a quote from the supplier or manufacturer – as they don’t publish their prices!

If you are looking into buying a basic franking machine to deal with up to 100 letters daily, expect to pay between £1000 and £3000, and up to £25000 for a state-of-the art, automated, high-volume machine!

Franking machine rentals only cost between £15 and £49 monthly for a basic machine, and up to £500 for the heavy-duty products.

Maintenance and Servicing

Another advantage of rentals is that the supplier will generally provide maintenance and servicing during the rental period. Royal Mail requires every machine user to have his machine inspected annually.

Franking Machine Rental Disadvantages

Dependence on the Supplier

Many users are initially happy with the savings through franking machine rentals, until they realize they’re under total control of their suppliers, who also do the maintenance, auditing, and servicing of the machines.

While a contract may look much simpler, suppliers might use that advantage to charge more for consumables than the client would shell out if he researched market prices, the competition, or even the manufacturer.

Purchased machines become an asset of the business, and the customer is directly in touch with the manufacturer. Sometimes, manufacturers will do the necessary servicing in a quicker, more efficient and cheaper way – some of them might even do it for free.

Total Cost of Ownership

Just like consumers of automobiles will decide whether leasing is better than buying, by factoring in parking fees, expected mileage, gas prices, and other variables, anyone interested in a franking machine should assess the cost of ownership.

Choosing the Right Franking Machine

Choosing the right machine depends on the type of postal items and number of outgoing posts you send.

Many machines come with scales that are very useful if you need to send parcels in bulk. If you post heavier items in bulk, be sure to check what the upper limit of the scale is. The supplier will help you choose the right machine.

If you’re unsure which machine is perfect for your business or you think your needs might change, it’s probably worth leasing a machine because most suppliers will allow you to downgrade or upgrade your machine.

If you purchase a franking machine, be aware that they’re quite difficult to sell second-hand, since the license will need to be transferred and this is a tricky business.

Conclusion

A franking machine is a great investment for any business and with ever-increasing stamp rates, more and more businesses are turning to franking machines to help save them time and money.

Whether you run a large, medium, or small business the use of a franking machine will cut down the amount of time you spend getting your mail ready for posting. It will certainly save you money in the long run as you’ll be entitled to the discounts offered.

The image you project for your business will be enhanced and you’ll be able to customize your franking mark. This means you can use it to advertise brands, products, and your business in general on a daily basis.


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by Lottie Pritchard // Lottie Pritchard is a contributor to Businessing Magazine.

Opinions expressed by contributors are their own.