Learn about this little known clause in office equipment lease agreements.
If you plan to lease equipment or have a lease in place, you owe it to yourself and your company to read the fine print carefully.
Most office equipment lease agreements contain a “Hell or High Water” clause to bind the purchaser to make the specified payments in the agreement regardless of any difficulties they may encounter with the equipment or with the servicing dealer. As most office equipment dealers use third-party leasing companies, they do not have the flexibility to amend your lease in any way.
To protect your business, look for a partner that has true in-house leasing and demand that the Hell or High Water clause be omitted from your equipment lease. In-house leasing allows the dealer to have flexibility in working with your business that is not easily available with third party leasing arrangements.
As Spring often brings heightened awareness to disaster preparedness, checking your lease agreements is another item add to your checklist. Read more about in-house leasing here.
Ralph Mello – General Counsel
Click here to view Ralph’s bio.
Document management to minimize impacts of business disasters.
Businesses continuity planning increases in importance as businesses of all sizes must recover from disasters more quickly today that in the past to meet customer demands. With the average 3 drawer filing cabinet holding 18,000 sheets of paper, significant amounts of critical business information is in jeopardy when digital document storage and back-up systems are not in place.
What is a disaster?
Businesses should be aware that many hazards they face today could results in a disaster to operations and information. Disasters born out of natural occurring events like tornadoes, floods and hurricanes spring to mind for most people. But consider the impact of widespread illness or pandemics, human-caused events such as acts of violence by people and acts of terrorism and technology-related failures or system malfunctions.
What documents are critical to digital storage & back-up?
Critical documents may be described as those vital to your organization’s survival and to the continuation of business operations.
- Sensitive to downtime
- Fulfill legal or financial compliance
- Key to maintaining market share and reputation
- Safeguard an irreplaceable asset
Examples of such documents are invoices, contracts, customer records, patient data, audit documentation, research reports, intellectual property and more. Conducting an analysis to identify critical business functions can help identify the critical business documents.
What are consequences of losing document information?
- Lost Revenue
- Delayed Revenue
- Increased Expenses (recreating documents, overtime, outsourcing, etc.)
- Regulatory Fines
- Decrease in Customer Satisfaction
- Loss of Customers
- Loss of New Business
What is document management?
Document management systems allow businesses to scan, store and manage document information digitally so that the information is accessible from any device anywhere.
Business owners — and homeowners alike — are advised to purchase insurance against the possibility of loss or damage of physical property as the result of fire, flooding, a tornado, a hurricane, or other act of Mother Nature and even liability insurance to provide protection from potential legal threats. However, most do not insure the most business crucial part of their business — their data.
In addition to insuring physical property and liability risks, it pays to take the necessary steps required to ensure the safety of — and ready access to — financial information, customer information and other data necessary to running your business through effective data back up systems.
Today, data back up systems are simple, automatic and cost-effective for small and medium size businesses (SEE BLOG POST “LOST DOLLARS.”). Whereas, the cost of not having a back up system in place can be astounding or even devastating:
- 94% of companies suffering from catastrophic data loss do not survive. 43% never reopen and 51% close within 2 years. (University of Texas)
- 70% of small companies (fewer than 100 employees) that experience major data loss go out of business within a year. (DTI/Price Waterhouse Coopers)
- 30% of all businesses that have a major fire go out of business within a year and 70% fail within 5 years. (Home Office Computing Magazine)
The stats are scary, but really unnecessary given the accessibility of back up systems to businesses of all sizes. Don’t be in the 94% of businesses that would not survive—investments in reliable data back up systems are some of the most critical and frequently used “insurance policies” you could acquire as a business owner.
Brantley Pearce – Director of IT Services
Brantley leads a team of IT professionals whose primary goal is to help organizations use their IT resources in a way that helps them proactively maintain their network and allows them to be more productive. He joined RJ Young in 2005 but has been in the IT industry for almost a decade. Brantley is originally from Houston, Texas and works out of our Nashville, TN office. In his spare time he volunteers for multiple organizations. Brantley is married and has two daughters.
Disasters can take many forms when it comes to unforeseen actions that can be devastating to any business. You never think it will happen to you and that it is always the other guy or company. In March of 1998 the RJ Young Company experienced a disaster first hand that created a real “March madness”. The building that housed the corporate offices sustained damage from a fire that started in a print shop that was renting the back portion of the facility.
The damage was mostly smoke and water as the alarm system in the corporate office alerted the fire department and they were quick to act to minimize the damage. After evaluating the damage it was determined that the building would need to be gutted and rebuilt which would take about a year to complete. Employees were relocated to other facilities so as to maintain a seamless approach to our customers.
The fortunate thing was that the computer system and critical data files were saved and the information needed to continue business as usual was secure. We were lucky in that preparations had been made, through the technology available at the time, to maintain digital files and backups. This prevented any major interruptions in services and support of the customers.
As you look at all of the possibilities that have occurred from hurricanes, fires, tornadoes, and floods in just the past few years, there is a case to be made for minimizing the loss of key information and downtime through proactive information management. No matter the size of the business, without proper information management, you can be out of business with one incident. Do not let a real “March madness” happen to your business.
Hunter McCarty – COO
Click here to view Hunter’s bio.