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Copier service agreements - what you need to know

The office copier is essential to many businesses and the service agreement that stipulates when and how repairs will be done is a very important part whenever a copier purchase or leasing decision is made. As with pricing for the copier or multifunction itself, the service agreement pricing can vary significantly from vendor to vendor and can definitely be negotiated, although most will tell you it canít. Make sure you compare by getting at least 3, maybe 4 quotes for the same level of service from multiple vendors.

Copy volume assumptions
All service contract pricing is based on estimated monthly copy/print volume. However, your usage is likely to fluctuate from month to month. This could be due to regular business cycles or holiday periods.

Do not enter into contracts that stipulate annual or monthly copy volumes that are unrealistically large. Although you may get a lower cost-per-copy rate, if you donít meet that volume, you will not be reimbursed for the difference. Similarly, if the volume estimate is too low, dealers often charge a cost-per-copy fee above and beyond that limit, which can significantly ad up.

If youíre not sure of your copy & print volume, get on a service plan that charges only for the copies you make (pay as you go), or one based on your estimated annual, not monthly, number of copies. A fair dealer will agree to those terms.

Many service agreements charge monthly in arrears for the copies/prints you made the previous month. This is a great way to control cash flow and most of these agreements can be negotiated to include toner. If toner is not included, a lower cost-per-copy should be charged. Make sure you understand if toner is included in your contract.

What does the agreement cover?
Most copier service agreements tend to cover all parts and labour for repairing and maintaining your copier. Unfortunately, "parts" can often have a different meaning from vendor to vendor. Parts that break during use are almost always covered, as are parts that wear out over time, such as fuser rollers, cleaning blades and other parts often bundled in preventative maintenance kits. Just make sure you get a written list of exactly what is and what isnít covered. You donít want any expensive surprises.

Emergency breakdowns
A service agreement should give you the peace of mind that you get quick and reliable repairs when you need it, and that any cost is covered by the agreement. Without a service agreement, labour and parts are usually priced on an as-needed basis. When you get your quotes, be sure to get a written commitment on response time (the typical maximum is four hours) and the hours that service is available, particularly if you expect the copier to see a lot of use during evenings and weekends.

Also ask about their replacement guarantee. Many vendors will provide you with a replacement copier of equal or greater specifications if yours requires significant repairs. If it is a temporary situation, they may be able to provide you with a loan machine.

Future price increases
Find out how service contracts will be priced in the future. Costs should ideally be limited to increases of less than 5 - 8% a year. A typical condition that may be in the T&Cís of an agreement can be that the vendor reserves the right to increase copy cost according to yearly CPI increases. And low and behold, every year your cost-per-copy automatically gets increased by 10%. Keep an eye on this, as most customers simply pay their bills and donít question, or are even aware of the increases. Just know that if it states ďincrease as per CPI indexĒ, that you can insist this happens, which usually means it should be below even 5%. Most vendors will lower or cancel the cost increase if you bring this up with them, as they donít want to lose you as a customer.

Consumables
Consumables such as toner are usually excluded from service contracts, unless you opt for an all-inclusive contract that covers all parts, all labour and consumables (toner, developer etc.) - except paper and staples.

All-inclusive contracts are easier on the accounting, but will most likely cost you more over the life of the machine. Although it can depend on what your typical output documents are. If for example you are a real estate agent and on your colour multifunction device you print 100ís of full colour sales brochures every week and have negotiated a very good cost-per-copy for colour, you may actually be better off on a toner-inclusive contract. The reason for this is that prices are based on the industry standard 5%-6% page coverage. The yield of a toner cartridge is also stated as based on that standard average. However, whilst a simple letter may in fact be about 5% or even less toner coverage, a full colour sales brochure with property photos on it will have a much higher coverage, maybe as high as 60-80%. You would go through a lot of toner kits and if you were to purchase these separately, you would likely spend more than if you negotiated a toner-in cost-per-copy, based on the typical 5% - 6% coverage.

Please note: some copier dealers may falsely claim that you must purchase your consumables through them. This is not required, so stand your ground.
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