Telecoms Equipment: Buying Vs. Leasing

In business, right decision-making is very fundamental. That means, before taking any step, involved parties should come together and decide the best way forward for the firm. When it comes to acquiring telecoms equipment, a business can either buy the phone systems or lease them. The decision you take depends on a number of issues but what you should consider most is whether the decision you make will transform the business. Here are two methods of acquiring telecommunication equipment and they will help you make the best decision.To start with, in business, given the chance, you should always consider buying something that appreciates in value and lease stuff or property that depreciates. This is because if you decide on reselling the property, you will get a profit instead of a loss. Having said that, you should know that telecoms equipment are among the assets that depreciate and from time to time, the technology behind business phone systems is bound to change which will mean the telecoms systems you have today might be irrelevant tomorrow, which will force you to acquire a new phone system. From this viewpoint, leasing telecoms equipment seems to be the better option for a business but do not rush into making such decision. You should first carry out a thorough analysis considering the following.
Before deciding whether to buy or lease telecoms systems, you should consider the availability of cash and the time you are required to make the payment. When leasing VoIP phone systems or anything, there are interest rates that leases attract. Also, in order to get money to lease the business phone system, chances are you will have to borrow, a move that equally attracts interest charges. What you have to do here is to analyze and see whether paying double interest rates to get telecommunication equipment on lease will be beneficial in the end or not.
You should also consider tax benefits that come with leasing telecoms systems and the tax implications of buying these equipments. When calculating this figure you should include all tax credits that you will accrue when you buy the telecoms equipment. All in all, the point is that you should consider the financial implication of either leasing or buying business phone systems. When doing the calculations, always involve your accounting team. As much as leasing comes with a number of tax breaks, always consider the amount you will pay to purchase the telecoms equipments and the lease rate. Also, consider the lifespan of the technology; if it is likely to outlive the lease, you better buy. Do not forget the financial position of the firm before acquiring phone systems.
At times, you should do both of buying and leasing. That means assessing which telecoms systems can benefit your company if you were to buy it instead of leasing. For instance, you can lease the hardware and buy the software. Here is how it works. Telecoms equipment like PBX and VoIP phone systems run on software which has to be bought or can be got for free. If you don't anticipate a drastic software change in the near future, you can buy it and lease PBX hardware. Whether you want to buy or lease telecoms equipment, not you should carry out a meticulous comparison before deciding.
Brad Mayhew is the author of this article on Telecoms.



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