Organizations may choose to own or lease products due ti the costs and benefits of each decision. When owning a product, one of the advantages would be cost savings. This is because for a product which must be used frequently over a long period of time, purchasing the product would be much cheaper than leasing it. Next, by owning the product, the company can use the product as and when required. In contrast, the product may not always be available for lease. Thirdly, when an equipment is owned, the organization can use the equipment flexibly in ways it likes. On the other hand, rules and regulations may have to be followed when using products that are leased.
In terms of cons of owning, the first disadvantage would be cost. For equipments that are used infrequently, purchasing the product would be much more expensive than leasing. In addition, more money will have to be spent on maintaining the product. The third con of owning an equipment would be the cost of depreciation incurred.
The advantages of leasing an equipment will include cost savings for organizations that are using the equipment on a short-term basis and would have no use for the equipment in the future. In addition, the organization can gain access to a wider variety of equipments through leasing as opposed to owning whereby funds may only be sufficient for the company to purchase one equipment. The third pro of leasing would be that the company would not have to incur any costs of maintaining the equipment or repairing the equipment should any problem crops up.
Finally, the cons of leasing include the lack of flexibility in usage due to rules and regulations imposed. In addition, it can be considered costly to lease a product that is used frequently over a long period of time. Furthermore, the equipment may not always be available for lease and thus the failure to gain access to the equipment may hinder projects and lead to even higher costs for the organization.