The murky pricing of MFPs

How much will a new MFP cost? Well, how well do you haggle? Here’s our quick guide to how MFP sales work.

Priced in the same way copier are, MFPs are usually leased, with service and supply contracts negotiable and based on usage volume, or “clicks.” Add confusing lease-termination options, and you’re facing a quagmire.

The deal involves three main parts; negotiate each part separately. First, agree on a price and payment structure. Most deals are lease-to-own, with payments based on the purchase price — approximately 25 percent to 35 percent off the list price. Hewlett-Packard encourages customers to buy the LaserJet 9040mfp directly from its Web site at what amounts to a published street price, but the company’s authorized dealers also sell the system. At Xerox, “estimated retail price” is probably your negotiation starting point.

Most lease agreements run for three to five years and end one of three ways: You pay $1 to finalize the purchase (because you’ve already paid for the MFP through the lease); you pay 10 percent of the original price; or you pay the current fair-market value. The latter has the biggest last payment and the lowest monthly payments. Any contract should allow you to decline the purchase; you lose your equity but avoid getting stuck with an old or obsolete machine.

The second step is financing; you can secure your own, or the vendor can arrange it through a third-party credit company, such as GE Capital, at standard interest rates. Resellers who get a piece of the loan action may “optimize” the loan for their own benefit. Some vendors also subsidize loans.

Because many of these MFPs have a paltry 90-day warranty, a service contract is the third negotiable element. It should cover all maintenance, parts, repair, and perhaps toner. Most include installation and a training session.

The contract usually commits you to paying for a certain number of “clicks,” which are essentially prints and copies, per month. (MFPs record scans and outgoing faxes as clicks, but few dealers charge for them yet.) Most dealers categorize customers into usage-volume tiers and have price ranges for each tier. For example, if you commit to 10,000 clicks a month at 1 cent per click, you’ll pay $100 a month for your service contract. The higher your tier, the lower your click rate should be. Commit carefully; you pay for allotted clicks you don’t use. If you exceed your allotment, you pay for the extra clicks.

Click pricing is as murky as lease pricing; we got prices as high as 2 cents per click in our research. Jon Bees, editor in chief of Better Buys for Business, says a good deal for these machines would be less than 0.9 cents per click and could drop to 0.75 cents per click. Lexmark doesn’t include toner with the X830e’s service contract, which adds about 0.69 cents per print. HP’s direct-Web sale doesn’t include training, installation, toner (0.71 cents extra per print), or service; on the other hand, the LaserJet 9040mfp comes with a one-year on-site warranty, and the company sells extended warranties.

So, what’s the take-home message for MFP buyers? Don’t pay retail, or even street; don’t trade away good service terms for a low purchase price; and don’t ink a deal before checking out the dealer’s reputation. Good luck.