When it comes to your time and attendance solution, one key question you need to ask yourself is whether you want to buy or lease your time clocks. There are pros and cons to each option. Knowing what those are can help you make the best decision for your business.
Types of time clocks
Before deciding whether to buy or lease a time clock, it is important to know which types of time clocks are available.
Here are some of the best types of time clocks along with their pros and cons:
Punch cards
These reliable timekeeping stalwarts are simple. Your team member places their punch card into a machine that marks it with timestamps that are used to calculate the hours they worked.
Pros:
- They're easy to learn and use.
- They're ubiquitous, accessible for all.
Cons:
- Team members can clock in and clock out for one another.
- Calculating payroll is time-consuming.
- It's harder to track and trace records.
They are often considered outdated in light of higher-tech options.
Editor's note: Looking for the right time and attendance system for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.
Card-based systems
These systems use a card to clock a team member in and out. Each card is unique to the person to whom it's issued. Depending on the system used, the card may have a stripe to swipe, a QR code to scan or an RFID chip, which is detected by a sensor when it's within about 10 feet of the sensor.
Pros:
- They're familiar to team members and management.
- They're easy to implement and use.
Cons:
- Team members can clock in and clock out for one another.
- Old cards need to be deactivated and replaced with new cards if lost or stolen.
PIN-based systems
To clock in on a PIN-based system, your team members will enter a PIN (personal identification number) or password on a number pad. Some systems come with a swiping card for additional verification.
Pros:
- They can clearly track movements directly to one team member.
- They're an easy solution for team members who may forget their cards.
Cons:
- PINs are easy to forget.
- PINs can be guessed or hacked easier than more complicated methods of entry.
- Team members can clock in for one another if they share each other's PINs.
Biometric time clocks
Biometric time clocks use a fingerprint or similar body scan to ID employees clocking in and out. They do not require passwords or badges. Team members place their finger on the scanner a few times while the machine reads the fingerprint and then records the information.
Pros:
- They cut down on co-workers clocking in for one another.
- They offer an additional level of security.
- Team members don't have to remember any passwords.
- There's no need to issue badges and replace lost or stolen ones.
- They prevent timecards from being altered.
Cons:
- They may create a sense of distrust between team members and management.
App-based time clocks
These time clock apps are installed on a smartphone or tablet. When your team member begins working, they launch the app and check in. Many of these apps use GPS tracking to help verify that work is done as indicated.
Pros:
- They're simple to install on a team member's device.
- They're accessible and easy to use, particularly for remote workers.
- There's no additional equipment to purchase.
- Some time clock apps are free.
Cons:
- Employees may not want work apps on their personal phones.
- They may present security issues.
Web-based time clocks
Similar to app-based time clocks, web-based time clocks need only a browser on a computer to access. To clock in, your team member visits the website.
Pros:
- They're accessible from anywhere, which is great for remote employees.
- There's no additional equipment to purchase.
- There's no software to download.
- They allow for easy data reporting and integrations with other services.
Cons:
- It can be easy to forget to clock in and out.
- It may be difficult to confirm an employee's identity.
How much do time clocks cost?
Price depends on the type and quality of the time clock you purchase. You should also consider the product's life span and malfunction rates when estimating costs.
"Buying a time clock is no different than any other purchase: You get what you pay for," Ryan McColgan, vice president of sales and marketing for Accu-Time Systems Inc., told business.com. "It might be tempting to spend less money on a time clock in the $200-$300 range, but those devices will often end up running you well over $1,000 due to higher failure rates and short life spans … A well-designed and -built time clock will live up to a decade."
Ed Squires, president of Acumen Data Systems, said businesses must factor in all the necessary add-on equipment when considering costs.
"Pricing includes a time clock, wall mount and power pack," he said. "Options for auxiliary ports, Power over Ethernet, UPS batteries and industrial enclosures could add to the pricing where applicable."
According to Squires, prices range from a couple hundred to a few thousand dollars, depending on the quality. For example:
- Economy: $150 to $895
- Midrange: $995 to $1,795
- High end: $1,795 to $2,795
When choosing which level of quality is right for you, be sure to assess your needs. If your business requires only a punch-in/punch-out time clock, it might be best to purchase a lower-priced one. On the other hand, if your business requires a high-functioning, high-security time clock, expect to spend the money on a high-end one.
Where can you buy time clocks?
Time clocks are a common item that can be purchased at many office supply stores. You can also get them online from an office supply store or other retailer, or direct from the manufacturer.
If you are purchasing an app-based time clock, you can do it from the App Store for Apple devices or Google Play for Android devices.
What are the pros of buying a time clock?
Buying a time clock will likely cost you more money up front than leasing one, but it does have its benefits.
"The main advantage of buying a time clock is that the company will not have to sustain any costs other than the retail cost of the system and regular maintenance," said Jacob Seiter, financial expert and founder of My Best Wallets.
Owning a time clock gives you 100% autonomy over that device for its entire life cycle, and it means no monthly rental payments.
What are the cons of buying time clocks?
The biggest downfall of buying a time clock is the initial cost. If you do not have the cash upfront to purchase one outright, this might not be the right choice. It is also important to consider the amount of money and energy you might spend on maintenance, as this is solely your responsibility.
Additionally, if the technology becomes outdated or your business needs change, you will be left searching for a new time clock.
When you should buy a time clock
If you have the money available upfront, it is best to buy your own time clock. If you need only a single economy clock, it wouldn't be worth the headache of remembering to make monthly lease payments.
If you need to purchase a high-end time clock, it is best to buy from a company that is known for excellent customer service to ensure that your maintenance or repairs are as seamless as possible. The amount you will save in monthly lease fees should be more than enough to cover maintenance costs.
If you know exactly which model you will need and don't intend on scaling, it is best to buy a time clock, as it will eventually pay for itself.
How to lease a time clock
As with many other types of equipment in the workplace, you can lease a time clock instead of buying it. Leasing a time clock has many of the same benefits and drawbacks as leasing any other item. See our guide on leasing equipment for general information.
How much does it cost to lease a time clock?
Leasing a time clock comes with a monthly payment, in contrast to buying it outright. This amount changes depending on the time clock you lease.
"Each vendor will have a different pricing structure for additional services, like support and hosting fees, in addition to the monthly fee for the time clock," McColgan said.
The cost of leasing a time clock varies by type, quality and provider. According to Squires, a time clock lease can be structured in several ways. The leasing can be broken into hardware as a service (HaaS) or a typical leasing structure.
Squires said HaaS, like cloud-hosted software as a service (SaaS), allows for a low barrier to entry into the market.
"It is a little different than [typical] leasing, as it is a perpetual rent of the time clock at a fee that basically warrants the time clock for life," he said. "If you have a failed clock through normal wear and tear, the clock is replaced free of charge."
According to Squires, these are the estimated costs associated with leasing and HaaS:
Economy time clock
- Lease: If a single clock is leased, it most likely will not qualify for leasing.
- HaaS: $15 to $35 per month
Midrange time clock
- Lease: $1 buyout; $35 to $60 for 36 months
- HaaS: $45 to $75 per month
High-end time clock
- Lease: $1 buyout; $60 to $95 for 36 months
- HaaS: $70 to $110 per month
Lease terms can be extended based on quantity and total price.
What are the pros of leasing a time clock?
Leasing a time clock is like leasing a car. It allows you the flexibility to choose something now without consequences for wanting to change it later. This is especially beneficial if you foresee your business needs changing over a short period.
"By leasing a time clock, the company will have to pay a monthly fee; however, most businesses leasing time clocks include maintenance and repairs in the contract," Seiter said. "It is also easier to change the system once it's outdated."
This means less stress when something goes wrong with your device. The flexibility and peace of mind alone may be enough for you to choose to lease.
What are the cons of leasing a time clock?
Leasing a time clock may have a smaller price tag upfront, but it will cost you much more in the end. You are essentially paying a larger fee for the added convenience, new technology and routine maintenance.
If you are looking to acquire a large number of time clocks at once, leasing can result in unmanageable monthly fees. Leasing structures are often more confusing than purchasing structures, which makes it hard to make a direct comparison with the exact time clock you are considering.
When should you lease a time clock?
If you aren't sure which type of time clock will be most beneficial for your company, or you think your needs will change over a short period of time, it is best to lease. This will give you the option to switch time clocks after your lease ends.
If you don't have enough money to pay in full for the time clock you want, leasing gives you the option to acquire it without compromising.
Whether you are a first-time consumer or you are looking to replace your current time clock, explore all your options. Your company size, industry type, documentation needs and security level will all factor into the type and quality of time clock you need, as well as whether you should buy or lease it.
Time clocks vs. time and attendance software
If you're evaluating the difference between a time clock and time and attendance software, you're not alone: These two types of employee tracking serve a similar purpose. However, time and attendance software goes above and beyond what a time clock covers. While most time clocks track only time in and out – there are exceptions, such as web-based and app-based time clocks – time and attendance software can offer additional features like these:
- The ability to manage paid time off and sick leave
- Integration with top payroll solutions as well as human resources, labor management, and other departments
- Data history and analytics to evaluate time spent on certain projects or tasks
- Tools to create and build schedules
Benefits of time clocks
Starting a business is a large endeavor that requires lots of small decisions. Some of the fine details, like keeping track of how many hours each employee works, may seem like an insignificant aspect of the big picture. However, choosing a time and attendance system that makes time tracking a smooth process can be important.
Employees use a time clock to record their work shifts, including when they take meal and rest breaks. Time clocks assure that your business is acquiring accurate records that can provide valuable information if any discrepancies arise. Plus, they are often simple to use, can reduce errors and will monitor your employees' productivity.
Stella Morrison contributed to the writing and reporting in this article. Source interviews were conducted for a previous version of this article.