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  • 1.  Leasing equipment from 3rd party

    Posted 01-24-2024 12:16

    Good morning- I'm interested to hear if any core labs have experience leasing capital equipment instead of purchasing outright- particularly if leasing with a 3rd party rather than OEM. Specifically Im curious about how this arrangement works with rates, service contract/warranty, and end-of-lease options for trade-in/buy out etc. For reference, we are at a state institution and this would be in genomics core- but any applicable experience to be shared would be appreciated.  Thanks for any input. 

    Barbara



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    Barbara Fransway
    Manager Genomic Research Services
    University of Arizona

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  • 2.  RE: Leasing equipment from 3rd party

    Posted 01-25-2024 08:48

    Hi Barbara-

    I am also at a state institution and we have access to a leasing program offered by The State of Kansas which we utilize regularly.  In short, once we have the final quote worked out, the state entity purchase the equipment and we set up terms and conditions for an annual repayment amount.  We lock in the rate and term at the time the payment is made out of the state office.  The program will only cover equipment, not contracts or extended warranties and there are some limitations on early repayment.  That said, it has been a good tool for some of our cores.  You might ask some directed questions to see if your state has a similar program.

    We have also on rare occasion used a commercial entity to lease equipment.  The T&C and options are all over the map, but are often flexible.  If you pull in an astute procurement officer or contract lawyer, you can make sure that the terms are advantageous to your group. 

    Best-  

    Michelle



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    Michelle Winter
    Assistant Dean of Core Operations
    University of Kansas Medical Center
    Kansas City KS
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    Original Message


  • 3.  RE: Leasing equipment from 3rd party

    Posted 01-25-2024 10:14

    I am also in a genomics core and we have set up a lease through a 3rd party company with which my institution had a prior relationship. We set up a 3 year term lease with a $1 buyout at the end. If you would like specifics about the terms, I'm happy to discuss privately. Feel free to reach out.



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    Claire Hartmann
    Director of Bauer Core
    Harvard University
    Cambridge MA
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    Original Message


  • 4.  RE: Leasing equipment from 3rd party

    Posted 01-26-2024 10:29

    Hi Barbara,

    I'm in a Genomics Core and we have leased 3 sequencers over the years (two NextSeq 500s and an NextSeq 2000) through CSI Leasing (as required by the institution).  From a financial perspective it is not ideal because the 36-month leases were essentially 36 payments of 1/36 of the purchase price of the machine, but it allowed us to use our chargeback revenue to cover the cost vs waiting for potentially years for a capital purchase to be approved.  In many cases, we extended the lease another year or more, and in one case we purchased the machine outright ($28K for an NS500) after 4 years or so of leasing it.

    Our rates were not calculated any differently.  i.e., we did not add a fraction of our payment to the service fees, or we would not have been competitive.  We absorbed these fees as part of our operational expense.

    We always carry service contracts on our sequencers and continued to do so with the leased units, but it may have been required by the leasing company, regardless.

    One hidden cost for us what that we had to pay a tax on the unit each year.  This was thousands of dollars and unexpected at first.  Another was the thousands of dollars it cost to have our FSE lock down the units to prepare for shipping back to leasing company at lease-end.

    Overall, purchasing is likely better, but in our case, and Moffitt is no longer encouraging/improving leases, but it enabled us to acquire the latest equipment in a timely manner, and especially in the case of the NS2000, to return it after a couple of years once we finally got our NovaSeq 6000.

    Sean Yoder, M.S.

    Molecular Genomics Core Facility Manager

    Moffitt Cancer Center, Tampa, FL



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    Sean Yoder
    Molecular Genomics Core Facility Manager
    Moffitt Cancer Center
    Tampa FL
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    Original Message


  • 5.  RE: Leasing equipment from 3rd party

    Posted 01-28-2024 14:57

    Hi Barbara,
    Here at Mount Sinai, we are increasingly using third party vendors to lease equipment. The Icahn School of Medicine not being a state or federal institution, we definitely have less restriction on how we approach these leases. We often include the service contracts to time with the leases term. If the lease term is for 5 years, we usually include service contracts of up to 4 years, one year being included as equipment warranty. Our corporate office requires that we bid out the leases, which happens through the CFO's office. Both, the lease terms and whether it is a trade-in/$1-buy out/lease extension depends on several factors that are reviewed both by the core and the CFO. 

    A major advantage of this arrangement is that the lease costs are recovered almost immediately through the users fees without having to worry about the funds required to make a full purchase. 

    I hope this helps. Please let me know if you have further questions.

    Thanks,

    Shekhar
    Senior Director, Shared Research Resources and Core Administration
    Icahn School of Medicine at Mount Sinai



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    Shekhar Patil
    Administrative Director, CoREs and Shared Resources
    Icahn School of Medicine at Mount Sinai
    New York NY
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    Original Message


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