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Do We Really Need a Maintenance Agreement on our Copier?

Oct 23, 2017 9:16:36 AM / by

So… your company has purchased a new copier for the office. The negotiation with countless vendors on price, accessories and user needs has finally ended. The last item you need to address is whether or not you want to place a maintenance agreement on this device.

 These agreements are optional and at first glance may seem a bit pricey depending on the volume of impressions your office runs on a daily basis. However, it is important to understand what is included with these programs to determine if budgeting for this program is worth it.

Copier parts and service can be expensive.

 First we need to have an understanding of what the majority of maintenance agreements offer and what they do not.

 What does a maintenance agreement cover?

  • Supplies (this includes toner, developer, drums and waste toner containers)
  • Parts
  • Labor
  • Travel time

 What items are not covered under a maintenance agreement?

  • Paper
  • Staples (if a stapling finisher is on the device)
  • Damage caused by intentional mistreatment or damage caused by you moving it to a new location. (if the servicing dealer moves the equipment they are responsible for any damage, not you)

 Now that we have an understanding of what is normally included, we can focus on the real decision maker...price!

For the purpose of this sample, we will keep things simple.

Let’s say you purchased a mid-range color copier with a speed of 50 pages per minute. Your average yearly volume usage for b/w impressions is 60,000 (5,000 per month). The average color volume usage per year is 12,000 impressions (1,000 per month).

 Assuming the b/w impression rate will be around $.009 and the color rate $.06 (average rates for this size machine with this volume amount), we can calculate the price for a maintenance agreement would cost approximately $1,260.00 for the year.

 The average service call is $150.00 for the first hour and then is billed on the quarter hour. Also remember… without a maintenance agreement you will be paying for all parts to repair your copier.

 Toner for this particular unit is around $117.00 for a black toner (30,000 yield at 5% coverage) and $149.00 for each color toner (20,000 yield at 5% coverage).

Note: 5% coverage is not very much. “On the low side, most offices tend to print 10 – 15% coverage on black and white documents and 15 – 30% coverage when printing in color.”(http://www.raymorgan.com/why-beware-of-toner-coverage/)

With this in mind, we realize we will not be able to print 30,000 b/w pages or 20,000 color pages with just one toner. More will need to be purchased during the year!

 Taking all of this into consideration (and we will stay on the conservative side) let’s say a service call is placed 3 times in one year and the technician spends less than one hour in your office each time. The parts to make any repairs do not exceed $300 for the year. Given the volume you are doing, 4 b/w toners and a total of 5 color toners must be ordered for the year.

 $150.00 x 3 = $450.00

Parts             $300.00

$117.00 x 4 = $468.00

$149.00 x 5 = $745.00

 The total for the year is $1,963.00!

What was the cost for the maintenance agreement again? That’s right $1,260.00

A difference of $703.00 which could have stayed in your company’s pocket!

The toner alone would run $1,213.00, so even if no parts were needed and only 1 service call was placed, the maintenance agreement still would have been the better way to go.

 Bottom line…take a good look at investing in a maintenance agreement when purchasing your copiers. It may seem like an expense you would rather not have, but it may end up saving you money in the long run.

 

Michelle Wise

Written by Michelle Wise

Michelle has over 20 years of experience with Phillips Office Solutions in various positions within the organization. The last 11 years have been in the Document Management division where she advises clients on finding the best solutions to meet their needs and budget. she also has been known to go by the name Michelle Wise, shh...

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