Tuesday, December 16, 2008

Server Sales Down

It is becoming harder and harder to close server sales in this economy. Client are trying to hang on to their capitol until the economy improves.

We are pushing leases so our clients can preserve their capitol.

Here is some info on falling server revenues for the last quarter.

5 Reasons to Lease File Servers:

1. Leasing improves your cash flow. The main advantage of leasing is that it frees up cash. Equipment leases rarely require down payments, though you may have to set aside some cash for a refundable security deposit. By contrast, loans to finance the purchase of equipment typically require down payments of up to 25 percent or more.
2. Leases are easier to finance than purchases. Before extending a capital equipment loan, banks will usually want to see two to three years of financial records — which most new companies do not have. Leasing companies, on the other hand, usually require only six months to a year of credit history before approving a furniture or office equipment lease.
3. Leasing makes it easier to keep pace with technology. Leasing is especially attractive if your business relies upon cutting-edge technology such as the latest computers, communications devices, or other equipment. A series of short-term leases will cost you less than buying new equipment every year or two. Some office equipment leases even have yearly computer upgrades built into them — eliminating that difficult decision of whether you can afford to upgrade or not.
4. Leasing allows you to afford more. While you might not be able to afford to purchase those pricey ergonomic chairs your employees are asking for, you may be able to lease them. Better furniture and equipment can create a more professional image and boost morale and productivity.
5. Leasing has balance sheet benefits. You may be able to exclude some leased assets and related obligations from your balance sheet. Such moves might improve financial indicators such as your firm's debt-to-equity ratio or earnings-to-fixed-assets ratio. Bear in mind, however, that accounting rules do require your balance sheet to report assets leased under certain types of agreements.


  1. Leasing sure does sound like a good idea

  2. "Leasing allows you to afford more." That is very true. And any option that gives an IT person the abality to config a server that will be state of the art for a while longer is a good thing.

  3. I would also think there is no depreciation expense concerns and would enable you to have fixed server costs. Everything would remain under warranty for the lease.

  4. Lease for three years then replace, rinse and repeat. Always have your dell servers under warranty.