Time to negotiate a new copier agreement? You’re starting out at a big disadvantage.

Most likely you hammer out a deal once every four or five years; the copier dealers do this every day, and they’ve set up all kinds of ways to squeeze more cash out of the unwary.

However, there are a few tricks of the trade you should know about if you don’t want to get stung too badly. That’s the advice of copier guru Larry Hunt, who tracks trends and has been consulting for decades with front-line copier customers. A few pointers:

1. Get the real price

Figure out the approximate street price of the equipment you want to buy. The dirty secret of the industry: The list price has only a marginal relationship to the real price a dealer could offer you if there were no other way of getting the business. In reality, copier companies can come out with a brand-new machine with a list price of, say, $80,000, and yet sell it on the street — if they have to — at $40,000.

That big a price differential is not always available, but it’s surprisingly common. In any case, a 25% to 30% discount from list is customary in the industry, but no dealer will volunteer that. It pays to ask around to other buyers, if you can find them. (Tip: Hunt’s publications also have a lot of reader-generated details on recent deal, especially for higher-end machines.)

2. Work the competition

Give the dealer the clear indication that you don’t have to buy from their outfit. Start by getting at least three dealers involved in the bidding process. Even if you know exactly which machine you want, there are always at least two or three dealers in your area who carry the exact same equipment, and as the big differences between the vendors have smoothed out of the years, there are almost always perfectly good alternatives machines from other vendors. The key is not only to make them compete for your business, but also to make them aware they are competing.

The best negotiating attitude you can convey is: “I’d like to buy from you, but…” The “but” can include pricing, features, service costs and service levels (including repair turnaround). Decide what you want in terms of features, and if it’s not part of the standard package, require it free or at a reduced price to help seal the deal.

3. Learn the total costs

You need to get the actual purchase price for every element of the deal. Dealers would like to give you a single number for everything, but it is important to get a close look at all the costs over the life the deal. That’s especially the case if the leasing deal is going through the copier dealer. In those cases, there is often a big discrepancy between the nominal purchase price and the actual amount you will spend. Look out for hidden fees that can sneak into a financing agreement.

Note also that interest rates for leasing are going up in the industry, While for years they were very stable in the area of 10-11%, they have recently been jacked up to around 14%. Given the gap between that rate and the dismal return on savings, it makes sense to either buy outright or to find some better way of financing the deal directly through your bank, if possible.

4. Consider cost-per-page

The other big factor is the service payments, which are usually calculated in cost per page, what in the trade is called cost-per-click. Getting the cost right on this can be even more important than the lease/purchase price. A difference of a few tenths of a cent per page can, depending on volume, add thousands of dollars to your annual expenses. That’s especially true for color, where the costs can vary be several cents per click. Make sure you compare those costs in detail before you sign on the dotted line.

For companies that print frequently on 11″ x 17″ paper, be aware of a major, often overlooked discrepancy in the market. Some vendors and dealers charge just one click per 11″ x 17″ page, while others charge two clicks. If you are frequently using the ledger format (for signage, folded booklets or engineering diagrams, for example), that difference can mean a big difference for your budget.

Tags: copiers, Larry Hunt, lease, negotiation