Many directors and administrators have asked why they should consider a lease/purchase program for acquiring new band instruments. The traditional answer is that, while staying within a reasonable budget, the school has the opportunity to obtain needed equipment, or replace old equipment that performs poorly and/or needs ongoing expensive repairs.
However, today’s school district is under increased pressure from many different directions. First, of course, are the traditional budget pressures, especially for traditional programs. While many classrooms are moving to digital formats for many of their resources, a band program requires instruments. A piano lab requires keyboards. An orchestra requires string basses.
Public schools are also under pressure to provide equitable opportunity to every student regardless of economic status. In many states and districts, if a student wishes to join band and cannot afford an instrument, it must be provided for them.
Despite these added requirements, budgets are not increasing proportionately. A lease/purchase program provides a proven solution.
The Lease/Purchase program is designed to meet the current needs of both individual schools and entire districts or school corporations. It ensures that instruments are available when they are needed (now), while assures ownership of the instruments at the completion of the agreement. Lease/Purchasing also allows you to lock in your pricing for instruments you might have otherwise purchased in two or three years – almost assuredly at higher prices.
Musical instruments are ideal for a lease/purchase program. The lifespan of good quality instruments is usually ten to fifteen years, with proper upkeep. A three to five-year lease plan gives the school a more realistic value over time so that annual budgets can be used more wisely. At the same time, the school is reserving ownership of the instruments for many more years of use.
The lease/purchase agreement is renewed each year automatically for the length of the term stated in the lease/purchase documents. The only reason a lease may not be renewed is for non-appropriation of funds. The lease/purchase agreement is specifically designed for annual school budgets. This is quite typical for school districts in most states.
Quality lease/purchase programs provide the school the greatest amount of control over the instruments and vendors they choose. Rather than using just one vendor, wise purchasers will find the best vendor (but not necessarily the lowest price vendor) for each product and then consolidate the purchases one lease/purchase proposal. Be sure to account for shipping charges in your planning. They are usually not part of the quoted vendor cost.
Warranties are always handled by the vendor and the school. The lease/purchase company simply assists in the financial acquisition.
Insurance is the responsibility of the school or district throughout the leasing period. Most school insurance policies cover such agreements, but it’s wise to check with the school administration.
Minimums – most lease/purchase programs have a minimum of $3000 to lease over three years. There is no maximum amount, but most instrument leases end up between $10,000 and $30,000. That’s a lot of money to spend in one year for instruments, but over the course of four or five years, those figures are much more tenable.
Here’s a step by step process for most lease/purchase agreements:
- Discuss your needs with your administration. Ask about the possibility of a lease/purchase program for band instruments. Has the school used lease/purchase in the past? Always get pre-approval from your administrator before moving forward.
- Discuss your needs with your vendors. Ask them for equipment quotes, including freight.
- Assemble a composite list of equipment you wish to obtain. Include brand, model number, general description, quantity needed, suggested list, quoted price and freight quote.
- Download the Lease/Purchase Proposal form so you can fill it out online or print it for handwritten submissions. Submit your proposal request to SM Management at firstname.lastname@example.org. You will receive a lease/purchase proposal with several options for your review. If accepted, a formal lease/purchase agreement will be prepared and sent to the school for authorized signatures. Return the signed agreement along with the first annual payment.
- Order the instruments. After receiving the instruments, school officials will need to sign an “acceptance certificate” to verify that the instruments have been accepted by the school officials. Send the acceptance certificates along with copies of all vendor invoices. The leasing company will immediately contact all vendors and complete the payments of the invoices.
- Subsequent payments will be due as scheduled on the agreement.
- At the end of the lease/purchase agreement and after receipt of the final lease payment, SM Management will issue an invoice for $1 to complete the purchase of the equipment for your program.
For a complete Lease Purchase Planning Kit, contact email@example.com.