Device as a Service (DaaS) is an operational expense not a capital expense

17th July 2020
Safeguard your IT with Devices for Teams

In the past, obtaining the IT equipment your business needed was always an expensive task. Organisations had little choice but to purchase tech in bulk with a hefty upfront price tag, then stick with their equipment for as long as possible before having to pay out again to upgrade a few years later.

In this way, IT equipment was always a capital expense or expenditure – or capex, for short. Yet these days, there’s another way to ensure your business has the up to date tech it needs, in the form of the flexible, opex-friendly Device as a Service (DaaS) subscription model.

DaaS enables you to kit your business out with the latest IT equipment for a single monthly fee, then scale your subscription up or down depending on what you need over time. What’s more, DaaS is what’s known as an operational expense or expenditure – or opex – which come with considerable financial benefits.      

Capex vs opex

Let’s take a closer look at each of these expense types and how they compare.

A capex is a type of expenditure that is paid in one go, in a single upfront payment. Capital expenses are usually used to purchase, acquire or repair high value, long-term assets, such as a business premises, or a patent or licence. With a capex, tax relief is applied upfront too.

Traditionally, IT equipment was considered to be a capex, since businesses had no choice but to invest in multiple PCs and/or laptops, and own them outright.

So how is an opex different? Rather than being payable in one go at the point of purchase, operational expenses are spread over a longer period of time, generally through regular monthly payments. Typical examples of operational expenses include software leases, procurement contracts and even printer cartridges, anything a business uses to help run operations day to day. Tax relief for an opex is also spread throughout the duration of the payment term.

An opex helps to free up a business’s cash flow so that more money can be put into the business itself; such as for developing products and/or services.        

The pros and cons of purchasing hardware.

DaaS as an opex

Thankfully for today’s businesses, obtaining IT equipment is far more flexible than it once was. With a DaaS subscription, such as Hardsoft’s Devices for Teams, tech becomes an opex rather than a capex, with all the benefits that brings with it.

Devices for Teams grants access to the latest and greatest Apple, PC and portable technology, without the major outlay of a capital expense. Instead, you pay an agreed monthly cost only for what you lease as an operational expense, enabling your business to spread the cost and tax relief of your tech. Designed specifically for business with 40 people or more, Devices for Teams is a ‘pay-as-you-go’ opex-friendly route to the tech you need, as it gives you complete control over your spending.

And, as we understand that business needs can change almost overnight, Devices for Teams has been created to adapt with you. Say you win a big new contract and you need to bring in extra contractors to fulfil it – you can add devices to your Devices for Teams subscription at any time to ensure you have the extra IT equipment on hand. 

Or, perhaps you need to temporarily downsize and you suddenly have several devices you no longer need. Rather than continuing to pay for tech you’re not using, Devices for Teams enables you to return them to us after one year of your subscription, providing you still have at least half of your original lease. Your monthly subscription fee flexes up or down to reflect your changing requirements, so you only ever pay for what you’re using.

What’s more, it’s easy to keep your team happy and productive with the latest devices. Simply upgrade any Apple products after 12 months of your subscription and any PC products after 18 months; we can have your shiny new tech with you in as little as 24 hours. 

The benefits of leasing IT hardware.

So, should you purchase your tech or lease it through DaaS?

For any business that needs multiple devices on a scalable, cost-effective, opex-basis, a DaaS subscription such as Devices for Teams makes perfect sense. There’s no need to commit to a large capex for your IT equipment, especially when DaaS comes with so many additional benefits.

Devices for Teams can give your business cash flow freedom, as well as the ability to avoid tech depreciation and extend or reduce your leased devices to suit you. Every device comes complete with a 360° support wrapper, delivery at a time and place of your choice, plus bespoke configuration and installation if required.

If your business is ready to make the switch to predictable, opex-friendly monthly IT payments, get in touch with us today to find out more about Devices for Teams.