There are several different ways of buying a new Telephone System.
We have provided all the different options here.
Telephone System Outright Purchase
Naturally you can pay outright if you can afford it. You should expect to normally pay a deposit with your order for a new Telephone System. This would normally be around 25%-30%. You would normally then pay the balance once the telephone system has been successfully installed. Sometimes, if your telephone system project is fragmented and takes several months, which it can if it is a complex IP networking solution, you could negotiate stage payments.
Telephone System Leasing
Leasing a new Telephone System is an excellent way to finance a new system. It allows you to pay over a term (normally 3 or 5 years - we would not recommend leasing over a period of more than 5 years - if your supplier offers you 7 year terms, we suggest that you should think about who you are dealing with).
With the current economic climate, unless you have 3 years accounts behind you and a balance sheet which shows reasonable profitability, you may find it difficult to find a lease company to accept you. However, there is often someone out there that will finance it. You just have to be dealing with a good supplier with good contacts. Note if your balance sheet does not look good or if you have not been trading for more than 3 years, if you do get lease acceptance you must expect to pay a higher rate as you will be considered a higher risk. Some lease companies may insist on directors' indemnities if you are a higher risk.
If you do lease, look at the terms. If it is a 3 year lease you should pay 12 payments and 20 payments for a 5 year. Suppliers may make themselves look cheaper by adding extra payments (eg 1 +12)!! Also, enquire as to whether the lease is a fixed term lease or a minimum term lease. Fixed term means it ends at the end. Minimum term means it ends but unless you give written notice prior to the end you will keep paying!!
Also, establish from the outset with your supplier what happens to the telephone system at the end of the lease. There are alot of unscrupulous telephone system resellers out there and if you are not careful you will get caught out! We recently came across a poor customer that had paid £ 35,000 over 5 years for two Premicell units that we could have supplied for £ 600!! He was very embarrassed when we told him.
Leasing a telephone system does has some advantages. You have fixed costs spread over a long period. The payments are an expense which is included in your profit and loss account so it reduces your tax liability. Also, it sort of makes you change with reasonable regularity which really is a good thing as you keep reasonably up to date with technology.
Most Telephone System resellers will offer lease rental rather than lease purchase as this is the most common package available to them from the lease companies.
Remember, we always say the average life of a telephone system is 5-7 years so leasing is quite a good option.
Naturally, if you lease you end up paying finance charges.