Globally, a shift is occurring in which people prefer temporary to permanent ownership, and this is challenging the way traditional businesses operate today.
If you look at the technology space right now, the quick adoption of cloud services and The Internet of Things is providing businesses with an opportunity to create products and services that will give customers access to their offerings without being constrained by the inability to own these products outright.
The continuing growth of the shared economy has seen society grow increasingly comfortable with the idea of temporary ownership of goods and services, but if you look at companies like Fiverr who are providing short term, on demand help, you can see how the allure of temporary workers is also becoming more attractive.
The effect of this on the business landscape will see traditional pay-per-product companies moving towards subscription-based or pay-per-use business models.
This will afford businesses and consumers far more flexibility, as they will be able to choose to either pay as they go, pay a monthly subscription, or opt for a long-term contract – according to what they prefer.
Purchasing technology hardware
As a result of this shift, we are seeing a change in the way technology hardware is being offered by some of the leading tech companies such as Microsoft as they adopt the as-a-Service business model. Microsoft’s Surface-as-a-Service allows their customers to benefit from access to the latest hardware as well as faster device refresh cycles without needing to buy hardware that goes unused most of the time.
This trend that’s extending to IT equipment, shows that there is a global move in which many companies are choosing to lease their hardware rather than own it.
Leasing uses a pay-per-use model where businesses pay for the use of the equipment during its determined useful life span and they are free to return it to the leasing company at the end of the contract.
Rather than sweating their assets, they’re able to upgrade to the best equipment without running the risk of investing in machines that will become obsolete in a few years.
Leasing is not only more flexible – it is cheaper
The business value is not necessary just on the cost of the actual machine, but the money and time saved when the assets get older. The part you must replace, the memory or RAM you have to upgrade multiplied by the hundreds of devices in your environment, all adds up. Leasing is a cost-effective way to keep your equipment up to date without the burden of maintenance, recycling or disposing of obsolete assets.
Leasing unlike a bank loan, also offers a fixed rate for the term of the lease, allowing businesses to budget better.
With leading leasing partners, such as InnoVent, an IT leasing specialist who offers subsidised finance, the total cost of equipment can be reduced even further and allows companies to preserve their cash flow and redirect it to other areas in their business such as research and development or expansion plans.
Leasing technology is becoming the preferred method for many growing and established companies. Businesses are looking for ways to become more competitive and expand their reach in the market. Adopting a pay-per-use or subscription model affords businesses of all sizes the opportunity to conserve capital and reserve credit lines for more strategic investments.
For more information on leasing solutions, visit the InnoVent website.
This article was published in partnership with InnoVent.