INFORMATION TECHNOLOGY (IT) CONTRACT HIRE
Contract Hire is an excellent way to gain use of an IT solution
combining support and other services within a periodic payment.
Essentially, the user pays fixed repayments and in return receives all
the benefits of operating with state of the art technology including
the delivery, management and disposal of such product. As customers
move from the old economy to e-business based tools we can also
include ongoing hosting, ASP and maintenance payments all within one
One of the biggest benefits of this facility to customers
is that it may offer off balance sheet financial reporting. This can
result in improved solvency and liquidity financial ratios, which are
important when attracting new investment.
Services and/or maintenance costs can be
included within the agreement - no need for the customer to pay
separately for ongoing services and support; everything is included
within the minimum or fixed period rentals.
On or off balance
sheet financing – customer chooses which option is more suitable
(subject to auditor’s approval).
One periodic invoice – all
customers IT expenditure can be rolled into a single document with
detailed invoicing and group collections. This simplifies the accounts
payable process and aids budgeting.
Reduced life cycle costs -
rentals might only be charged on a proportion of the original purchase
price, keeping repayments to a minimum.
Fixed rentals agreed in
advance – regular payments are spread to match cash and/or income
flow; predictable payments facilitate project control.