Recently, PCD released a solution to our clients’ common AV issues by introducing AV as a Service (AVaaS). AVaaS provides options for customers to pay for audio visual equipment and services on a monthly basis, without a large cash payment up front. Customers can opt in to an AVaaS contract for a recurring fee and receive the flexibility to add or remove services or equipment after an initial contract term is completed and as their AV needs fluctuate through the years.
Operating Expense Versus Capital Expense
AVaaS allows filling audio / video needs through an operational budget rather than a capital expense. With this approach, the system will be maintained within a known budget even beyond the manufacturers’ warranty.
Operating Expenses are expenses such as administrative costs, salaries, staff training, and travel. These are the day to day costs that all businesses incur, regardless of size or industry. These expenses show on financial statements in the period when they were incurred.
Capital Expenses arise when businesses use cash or take on debt to purchase new assets. These assets become an investment in the company – something beneficial to the company as a whole in the long run. Capital expenses are fixed assets such as investing in a new office building, performing improvements on an existing building, new equipment purchased for use, vehicles, and hardware such as office computers.
AVaaS Means No Capital Cash Outlay
Until now, Audio Visual systems were typically Capital Expenses with large upfront investments. Participating in AVaaS permits organizations to have their AV needs satisfied through recurring monthly operating expenses rather than one-time capital expenses. These recurring expenses are easier to work into an annual budget and are beneficial because you don’t end up with old and outdated equipment at the end of the equipment life cycle. Relying on outdated equipment is the prime frustration of our clients – a problem that disappears with the AVaaS program.
At the end of the initial agreement, your equipment can be refreshed with the latest technology and can continue as a budgeted monthly expense.
The AVaaS Business Model
The AVaaS model provides a working AV system that is regularly maintained, and allows flexibility to swap or upgrade equipment as AV technologies continue to improve. With AVaaS you can rest assured you always have the most current systems–with technology being refreshed every few years under the term of your AVaaS contract, and PCD available as your on-call support system, you’ll never have to worry about an AV system that falls behind.