Summary: In this video, we will be going over what exactly service agreements are. This includes talking about the pros and cons of having a service agreement vs. not having one. In addition, this video covers the differences between bundled and unbundled service agreements, automatic price increases, and lastly, we will talk about how the monthly cost of a service agreement is calculated.

(Watch the video version of this post below)

What are the benefits of a service agreement?

    • Service agreements for an office printer or a multi-function machine have unlimited service calls.
    • The replacement of drums, rollers, toners, sensors, electronic boards, etc. is covered with everything except paper and staples. 
  • Without a maintenance contract, you would have a per-call charge every time an issue comes up with your printer. This is in addition to the fee for parts that need to be replaced, so it is essentially an hourly charge plus the cost of parts if any parts need to be replaced. 

What are bundled and unbundled service agreements?

    • Unbundled
      • Separate Lease and Service contract.
  • Bundled
      • Lease and Service agreements are together.
    • Lease and Service agreements are combined into one payment made to the leasing company.

What are Automatic Price Increases?

  • We write a yearly maintenance contract, and every year following, the cost of living expenses can increase up to 10% (this percentage varies, but the norm is generally around 10%).
  • There is no set standard for automatic price increases. It is recommended that customers contact their sales rep to see how each individual company handles automatic yearly price increases.

How is the monthly cost of a service agreement calculated?

Two Ways

    • Base+overage
        • A lot of customers like a base amount, so we’ll come up with a monthly average of their volume, and create a price based on that volume.
        • If they go over the volume, we’ll have a per-click overage charge.
      • A lot of clients like this method, so they can budget for it throughout the year.
  • Cost-per-copy
      • Another method is a cost per copy charge where we bill you every month or quarter on the total number of copies made for that time frame.
    • It is important to note that in both methods, everything is still covered (toner, parts, labor, etc.)

*If you have any questions, write us a comment down below, or call us at 706-546-1220.