Monthly vs. Quarterly vs. Annual IT Rental Plans: How to Choose

The first thing which comes into our minds while analyzing IT equipment rental agreements is as follows: “How long should I rent the device for?” 

It sounds absolutely clear, but actually it is not the case because apart from being important financially, the selected period of renting affects such issues as flexibility of use, replacement possibilities, as well as bureaucracy.

These are some of the basic distinctions between the above mentioned schemes and their optimal application areas.

Monthly Rental Plans: Maximum Flexibility, Higher Per-Unit Cost

This term implies that with the monthly plan, one rents equipment each month. In each cycle, you are free to extend or change your rental.

The monthly plan costs more than other plans. This happens because in addition to other advantages, you can return all the rented equipment within 30 days. However, some companies find that the higher price is worth it.

In what case do you choose the monthly plan?

• Uncertain Timeline: In case there’s an uncertainty regarding the timeline in which you need equipment. For instance, you may have an unknown customer where you will need to do something for him but whose success of the tender is uncertain and so forth.
• There is always fluctuation in the number of staff: Organizations which fluctuate in terms of staff in accordance to the projects or time of the year can go for a monthly subscription since it will enable them to either expand or scale-down whenever they wish.
• Short-term Need: You urgently need equipment for a particular project or event. Events, training, exams and other related activities can give rise to this situation. You require 20 laptops for three weeks; hence you need a monthly subscription in this scenario.

The downside is cost. It becomes very expensive when you are required to renew your subscription monthly for one whole year.

Quarterly Rental Plans: The Middle Ground Most Businesses Land On

The quarterly subscription plan provides the best balance of savings over monthly plans while keeping a reasonable subscription period.

It works great for Tricity businesses that are growing and require flexibility while still providing enough time to determine if their equipment and setup work as expected.

Here’s why the quarterly plan works well:

• If you have an assigned project or contract period. If you’re bringing in a client or implementing a phase of a development project, it’s likely going to take you one quarter to complete your project.
• If you need better pricing than monthly plans without being tied into a long-term plan. On average, the cost of using a quarterly subscription plan costs about 10-20% less than using a monthly subscription for the same equipment.
• If you’re a brand-new business trying to figure out their requirements. The three-month subscription plan provides enough time to test out things and make necessary changes after.

Annual Rental Plans: Best Value, Requires Planning

Annual subscriptions will guarantee the least cost per unit, 25–35% less per month when compared to a monthly subscription of the same equipment. In case you run a company with predictable IT needs, here is how the annual plan saves you money.

You will benefit from the annual plan if:

• Your company does not experience any variations. It is hard for companies in Phases 8B or Sectors 67 with constant employee numbers to return twenty desktops after just three months of operation. The risks are taken into account when computing the annual subscription price.
• Your company requires leasing of the whole office setup. Whether it is laptops, desktops, printers, or UPS, there will be more value added from an annual discount than leasing one of each piece of equipment separately.
• You wish to save yourself from administrative tasks. Monthly subscriptions require regular planning whereas annual ones do away with any need of planning.

Overcommitment is common in annual subscription plans. Any reduction in staff strength or alteration of IT needs within a year will see you paying for equipment you don’t fully utilize.

A Simple Decision Framework

Reflect on the following queries. First, how confident am I about my timeline? “I’m pretty sure it’s going to be 12 months,” make it annual. “Pretty sure it’s going to be three months,” make it quarterly. “Not sure at all,” make it monthly.

Second, what would happen if I was wrong? Let’s assume I made an annual commitment and ended up coming back before my time is up, how much would it have cost me? Or, let’s say, I made a monthly commitment and ended up extending myself to another month, what would that cost me?

KPI Solutions: Flexible IT Rentals for Every Timeline

KPI Solutions provides its customers with services of renting the items mentioned above at monthly, quarterly, or annual terms, whichever suits their requirements. We help you select the best suitable plan structure according to your needs rather than forcing any plan upon you. Quick delivery facilities, immediate replacement services, and no hidden charges. Call us now if you need advice about your needs.