Questions to Ask Before You Sign a Postage Meter Rental Contract
Before purchasing or renting any type of equipment, you should first obtain multiple quotes or proposals (at least three). Review these proposals carefully to ensure you make valid comparisons. For example, look carefully at service and support, whether the rental price includes any supplies, and what kind of reporting and data analysis the postage meter offers.
Which is better, a short lease or a long one?
The answer to this question depends mainly on your mail volume and how long you expect that volume to remain at its current level. Lease payments are nearly always lower the longer your lease terms, but that lower payment isn't always worth being tied into a long-term lease.
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If you operate a high-volume mailroom, you benefit from new and improved technologies, since each advance seeks to increase productivity and the number of items you process in an hour. While most companies allow you to upgrade your lease, you need to check with the dealer to determine whether this is an option, as well as what kind of penalties (if any) you incur for doing so.
If your current postage needs are on the light side and you expect them to remain there, a longer lease works well. Advances in postal tech solutions have little impact on your business, making lower monthly payments much more appealing. However, if your postage needs are in the low- to mid-range now, but you expect them to grow within the next five years, talk to your dealer about the possibility of upgrading within the terms of your lease.
When does my lease end?
This may seem obvious. After all, if you signed a 60-month lease on January 1, 2018, then your lease ends on December 31, 2021, right? However, if you renewed a postage meter lease, that isn't necessarily true. When you signed that lease, there may have been time left on an old lease, or delays on when the current lease officially began.
The average lease includes an evergreen clause. These mainly benefit the vendor, as they automatically extend your contract by at least 12 months if you fail to cancel, in writing, by a certain date. With some vendors, this is as much as 90 days before the end of the lease, but it may be as short as 30 days. To protect your interests, determine when your lease ends and the vendor's notification requirements.
How do I purchase postage?
Loading postage also varies a great deal by manufacturer and vendor. Loading postage via your USPS account is the most common, but even this includes variability. For example, you may send a live check to the USPS, load directly from the machine, or purchase postage at www.usps.gov and pay for it with direct debit, ACH, or via your account.
Some manufacturers also offer a mail now, pay later option, while others pay interest on pre-paid postage. That sounds great, but read the fine print carefully, as some of these accounts charge a fee every time you load postage. That fee may be greater than any interest earned.
How do we access our data?
One of the reasons to use a postage meter to begin with is the ability to track your spending and postal activity and, with the more advanced machines, break down costs by account. When choosing your meter, talk to your account rep about your data analysis options, including how to actually access said data.
In action, this typically looks like cloud access to your core data through your vendor account. This data includes your account, model, and serial numbers, with a complete inventory of leased objects, as well as invoices for your lease, maintenance, meter, and supplies. Finally, you should be able to review all postage activity, tracking the dates you loaded postage and in what amount, and usage by date and account number.
Does the rental agreement include technical support?
Technical support varies and may include anything from a simple manual (standard), an online contact such as chat support, or online help page for common technical problems, such as an FAQ page. You may also find providers who offer phone support and even onsite support. However, most contracts do not include tech support for tasks such as adding postage to your machine or checking your balance. Others provide service techs as part of their warranty program or maintenance contracts. Of course, if you don't ask, you don't know, and after-sale support (or lack thereof) makes a big difference in pricing. If one provider quotes a drastically lower or higher price than the others, it may be due to the level of service included in the proposal.
What am I being charged for?
Many lease agreements include line items for each item included in the lease, but not the charge itself. The end result is not knowing which line items carry a charge and which are simply standard with every rental or lease. When reviewing the agreement with your vendor rep, ask for an explanation of each line item. This way, you can determine incremental costs and how many of these items you actually need (or even want). You may be able to remove some of these items and lower the cost of your lease.
Do you offer reduced pricing?
Lots of vendors and manufacturers offer great discounts, but you won't know until you ask. In addition to discounts, you may save money if you wait to sign or expand your search to reconditioned equipment. Potential money-savers include:
- Price breaks for including multiple locations in your account
- Price comparison to keep current equipment versus new units
- Price-matching with other vendors
- Promotional pricing on certain models
- Remanufactured, reconditioned, and demo versions
- Special programs for new customers
You also want to ask about upcoming breaks. For example, many vendors offer monthly or quarterly deals. It may be worth waiting a couple of months to take advantage of a killer promotion the vendor intends to offer next quarter.
If you are renewing a lease, ask about the remaining balance in your current agreement. Often the new lease includes the old lease's balance and you'd be better off waiting to sign your new lease once your current lease ends.
Things to Remember
Take detailed notes when asking your questions. Answers often run together, especially if you obtain quotes from multiple vendors and multiple models and brands. Your notes will be highly valuable when comparing offers. Also, listen carefully to your account rep. Your goal is finding someone with excellent industry knowledge.
Review each contract carefully and ask about your options for breaking the lease in the event that becomes necessary.
Before choosing a manufacturer or model, look at the availability of consumables and supplies such as labels and ink refills. Some manufacturers require getting these items only from authorized dealers, but you can often find aftermarket options at office supply stores for much cheaper.
Finally, don't sign a contract with any company that doesn't have USPS authorization. Authorized manufacturers are Pitney Bowes, Neopost, FP Mailing Solutions, Data-Pac Mailing Systems, and Hasler, Inc.