Office Document Strategies Blog

Postage Meter Rental Contract Renewal, What to Watch For

Posted by Lee Kirkby on Fri, Apr 13, 2012 @ 09:04 AM

Postage Meter Rental Contract Renewal, What to Watch ForRenewing your postage meter rental or lease contract can be a challenge if you are not careful to understand just what is being done.

Note: There is no universal language for mailing equipment. Each manufacturer has different names for the components that make up the total pricing which can cause confusion for you when trying to compare between the three companies who offer postage meters in Canada. 

The Components of Mailing Meter Pricing

Equipment: Postage machines or equipment, the parts which actually stamp the envelopes, scales and sealers can be acquired in several ways. Smaller units are only offered on a rental basis, bundled with the meter rental. Mid range and larger units can be bought outright, leased or rented. Terms vary but usually are for 36, 48, 60 or 66 months. Owned equipment can be operated as long as it provides you with suitable service, although you must rent a compatible meter to go with your device. The meters are brand specific so owning your device does not free you from dealing with a specific vendor.

BEWARE:  Most leases or rental agreements have a clause that states you need to register your equipment with your insurer and your insurer must register it back with the Vendor. If this is not complied with, you get a levy on your billing and over the course of an agreement you will be spending as much as $1500 you need not have spent since your office insurance policy will cover postage equipment if you ask your insurance vendor to do so.  Check your current bill to see if you are paying for 'Value Max" or some other item you did not see on your original agreement.  If so, it most likely is an insurance surcharge. 

Meter Rental: Meters are controlled by the vendors (manufacturers) under agreement with Canada Post Corporation. They cannot be bought by end users, only rented on an agreement with the meter manufacturers.  Meter rentals are quoted monthly but usually payable quarterly or annually.

Meter Fees (postage):  This can be the tricky part as you may be thinking you may be getting a good deal until your bill comes in and there are charges for

  • Resetting your meter with more postage,

  • Digital reporting fees.

  • Late charges for invoices which are setup to make it hard for you to clear payment before the late charges impact.  The late penalty can be as much as 20% or more and applies with every payment you make in arrears.

  • Postal rate changes from Canada Post increases in postage rates and your meter gets reformatted. This fee depending on the model, can be up to $300+ dollars.

  • Insurance fees (see above)

Extended Maintenance Agreement: These agreements cover repairs and support needed to maintain the equipement. You need to know if this include parts and labour and if there is  a return replacement guarantee.

Consumables: These are always extra and manufacturers can charge you dearly. Know the difference between models.  The yields are not often telling the whole story. A manufacturer may brag of a large yield on a ink cartridge but if you are using a low volume machine you might find your cartridge dried up and gone thus replacing a lot faster than first thought.  Some cartridges are time chipped so they must be replaced whether empty or not.  If you don't know, then ask before you renew any agreement.

Expiry:   Be cautious that you know when you’re current agreement will expire. It is common practice for some manufacturers to request an updated agreement before the current agreement expires....even as long as two years ahead.  When you sign the new agreement you extend your rental and equipment agreement by the new term period, often without realizing this has happened. This could lead to double payment as the balance of the previous agreement will be bundled into the new plan. If in doubt, always ask for a summary of your current obligations and know your vendor.

Lastly:  Make sure if you are renewing your contract, what the terms are and what they include and do not.  Often renewal contacts can be very vague. Beware the statement “for all terms and regulations please refer to original contact” and then you are asked to sign without the original.  Be sure your renewal reflects your needs at the time and going forward.  Business needs change over time and when your agreement expires it is a great time to revisit your needs.

Do you know when your postage meter rental is due?  Have you reviewed your contract and invoices to see if they match?  Would you like an analysis of your contract?....

Share your thoughts below....

Joanna W

Free guide to postage meters Canada download

 

Joanna W. is the postage specialist at Leppert Business Systems Inc. 

Disclaimer: Leppert Business Systems Inc. is an authorized dealer for Francotyp-Postalia Canada.

 

 

 

Topics: Postage meter, postage rates, postage machine, mailing equipment