Leasing: an ecological and economical solution for IT asset management

29 May 2024

IT leasing is an attractive option for companies wishing to purchase IT equipment without making a major financial investment (CAPEX - for CAPital EXpenditure). This financing solution enables companies to lease equipment such as laptops, desktops, smartphones, tablets and accessories (among others) rather than purchase them (and therefore incur OPEX - for OPerational EXpenditure).

IT equipment leasing - what is it?

In today's ever-changing business landscape, the decision to purchase IT equipment is of crucial importance to companies. One of the questions that frequently arises is whether leasing or cash purchase is preferable.

IT leasing is a financing solution that enables companies to rent IT equipment rather than buy it. They sign a contract with a leasing company and pay rent, usually on a monthly basis, to use the chosen equipment.

The arguments for leasing are not just financial, however, as they also concern mobile fleet or IT asset management, and even digital sobriety and digital responsibility.

In fact, in a society increasingly focused on the diversity of devices and the economy of use, IT equipment leasing is one of the best choices for supporting organizations.

💡At bconnex, we strongly believe in the ecological commitment of companies on a complete scale. We believe that IT fleets are an essential pillar of sobriety and commitment, but they're not the only one. Other business equipment can be leased (or at least purchased refurbished), such as office furniture. Think about it too! Because it's by accumulating several angles of attack in addition to digital, that our companies will be able to be truly responsible.

But in concrete terms, why should you lease your IT equipment? What are the risks involved? And what factors need to be taken into account in a leasing contract?

Let's take a look at it 👇🏻

The benefits of leasing mobile devices

IT leasing offers a number of benefits for companies. These are economic, fleet management and ecological.

Cost-effective optimization of IT asset management

Cost control: IT leasing enables companies to control their costs by paying a fixed monthly or annual rent, a financing solution that is often more economical than purchasing IT equipment.
Optimized cash flow: the cost control provided by leasing also optimizes cash flow by avoiding the need to invest large sums of capital in the purchase of equipment, thus preserving borrowing capacity for other investments.
Tax advantages: leasing rentals are an expense for the company's financial year, which reduces the company's income and therefore the taxes due (corporation tax (IS) or income tax (IR) without distinction).

Optimizing the technical management of IT assets

Flexibility and scalability: with leasing, companies can modify their IT equipment according to their needs, and have little or no in-house management of maintenance, repairs and recycling, enabling them to focus on their core business rather than on IT asset management.
Regular hardware updates and employee satisfaction: thanks to leasing, companies can stay at the cutting edge of technology by benefiting from hardware updates at the end of contracts, and provide their employees with more recent devices (especially if there are internal cybersecurity requirements), while guaranteeing end-of-life valorization or recirculation of old equipment.
Consistent hardware and software: leasing also enables you to benefit from a consistent and regularly updated fleet.

Ecological optimization of IT asset management and device consumption

Ecological benefits : leasing helps to limit unnecessary purchases with a view to greater digital sobriety, but also extends the lifespan of IT devices by enabling devices to be passed on to several users or even IT fleets and optimizes the recycling of electronic and plastic components from end-of-life devices, as well as reducing the production of electronic waste

💡 Please note: leasing does not relieve you of cybersecurity, fleet management or onboarding/offboarding and assignment management!

bconnex can guide you through your leasing projects 👇🏻

Contact us

The risks and drawbacks of leasing IT equipment

There are many advantages to leasing, but there are also a few risks and drawbacks to bear in mind. Here are some of the risks to keep in mind:

Insurance coverage: make sure your leasing contract includes adequate insurance coverage for the leased equipment, and that it also covers maintenance and repairs in case of impact or fall, as well as the risks of loss or theft
Age of devices: to guarantee proper cybersecurity for your organization and collaborators, devices must be sufficiently recent to still benefit from the latest application and system (OS) updates.
Supplier dependency: companies may be limited in their choice of suppliers and models, depending on the leasing arrangements available.
Uncertain residual value: at the end of the contract, the purchase option may imply a residual value that can be difficult to predict accurately, as it depends on the condition of the equipment at the end of the contract - it is therefore important to protect the equipment physically, with hardened shells and glass, for example.

The criteria to consider in a leasing contract

If you are interested in leasing (IT equipment rental), it is crucial to keep in mind the key contract terms to ensure you are well-equipped and protected without being restricted:

Contract duration: Each provider sets different engagement and rental duration terms (minimum duration, maximum duration, renewal options, etc.). Ensure the proposed conditions align with your strategic and financial needs.
Rental cost: The rental cost can vary depending on the type of equipment chosen, the rental duration, and additional options selected. Make sure all criteria meet your needs and budget.
Payment terms: Some providers offer monthly, annual, fixed, or variable payment options. Carefully check that the terms suit your requirements.
Installation fees: Some providers do not cover equipment installation or may charge fees for configuring the rented equipment. Be sure to inquire about this before signing the contract.
Type of equipment provided (new or refurbished): Find out whether your provider offers new and/or refurbished equipment for lease, as this can affect rental costs, maintenance and repair conditions, or even contribute to your CSR and sustainable IT strategy.
Maintenance and repair conditions: Understanding the maintenance and repair terms offered by the leasing company is essential. For example, some may impose a maximum number of repairs within a given period, which could lead to unpleasant surprises.
End-of-contract options: It is helpful to know whether, at the end of your leasing contract, you are required to return the rented equipment or have the option to keep it by making an additional payment (purchasing the rented equipment).

In conclusion: Is leasing the right choice for your organization?

Ultimately, the decision between leasing and traditional outright purchase depends on the financial and strategic priorities of each organization.

IT leasing is a financing solution that allows businesses to rent IT equipment rather than purchasing it. The significant advantages of leasing include financial flexibility, easier management of mobile fleets or IT assets, and alignment with digital sobriety and sustainable IT practices.

Companies seeking more flexible cash flow management and regular hardware upgrades may find leasing appealing, while those focused on minimizing long-term costs and maximizing control over infrastructure may prefer outright purchase.

Regardless of the chosen option, conducting a thorough analysis and considering the organization’s specific factors is crucial to making the best decision for its needs.

It is important to remember that leasing is not a "one-size-fits-all" solution but one of many approaches to addressing procurement and environmental challenges. Additionally, purchasing refurbished equipment offers significant economic and ecological benefits.