As you get prepared to open a new restaurant business, something that you need to consider is whether or not to lease some of the commercial kitchen equipment. At the same time as you probably wouldn’t consider leasing a cooking range or a dishwasher for your home kitchen, leasing for a commercial kitchen sometimes makes the most sense. When equipping a new restaurant kitchen it is important to consider the equipment you pick out will get a lot more wear and tear than those of an average kitchen.
Factoring the cost of maintenance and the time it takes to fix something, it is every so often good to lease the equipment instead of buying it. Leasing can save you many startup expenses and come with better/longer warranties as compared to the equipment you purchase outright.
When Buying Makes More Sense Than Leasing
If those terms make you a little uneasy, or if purchasing just makes even more sense in regard to the restaurant equipment you require, consider getting a small business loan. Often times the interest rates on those can be outstandingly lower than with leasing firms, allowing you to finance your new equipment at big discount.
What to Consider Before Leasing Restaurant Equipment?
Most restaurant equipment leasing firms will not lease you any equipment valued less than $3,000, so start there. However beyond that you will need to consider how much financial sense restaurant equipment leasing makes. Primarily, when looking at your cash flow budget, additionally check if you have sufficient cash coming in every month so you can easily pay the likely lease payment. Otherwise, you need to find another financial solution to finance your leased equipment or it is better to hold off until you are in a better financial position.
Furthermore, consider how long you are planning to use the equipment. Objects that you don’t plan to replace for years, like brick ovens and dispensers make more sense to purchase. However for things that you only plan to apply for some years leasing is always the smarter funding solution.
Along those same lines, technology-driven equipment such as point of sale systems and dishwashers are also good to lease so they may be replaced as new technology becomes available.
Additionally, make sure not to get infatuated and over-lease. Even if a particular restaurant equipment falls within your cash flow budget to lease—for instance a pizza-baking oven that exists only where pizza is part of menu, won’t give you with enough of a competitive advantage.
If Your Need is Short-Term then Go for Leasing
If your business is just starting out, you would possibly need to go with more low-cost, light-duty equipment before you realize how much customers you’ll have on a daily basis. In case you lease this equipment, you may update it with more heavy duty equipment while business starts to pick up, without having to deal with selling the old equipment.
Benefits of Restaurant Equipment Leasing
Saves You Cash
Leasing heavy commercial equipment, like a business grade dishwasher, cooking range and some others will help you in saving your startup costs for some other restaurant functioning areas. Rather than paying large amount of bucks for those large equipment, you can use that amount in other restaurant areas, such as for filling inventory, furnishings and renovation of your place. You can also make your first payroll with this amount.
Some Leased Equipment is Free
Any of the equipment acquired in restaurant equipment leasing settings can be free as there is no monthly lease charges for that but only when you are previously buying the company’s other products, including coffeemakers, chemicals, and dishwashers and so on.
No Repairing Costs
In case of equipment damage or breaking, you don’t need to pat any repairing cost because in equipment leasing program, the leasing firm is responsible for all the repairing costs.
Flexibility to Upgrade
When the lease program on your commercial restaurant equipment is over, you can get a new model of the equipment in case you want to renew it.
It Is Better To Lease These Equipment
There are some commercial restaurant equipment that are better suited for restaurant equipment leasing program, because they have shorter life cycle and they wouldn’t be worth the funding to purchase new one. These equipment consist of:
- Ice Machine
There are some other objects that are perfect for leasing program include, staff uniform, dishrags, and floor mats. These objects get really filthy, quickly in a crowded restaurant. It is also good to outsource their maintenance to another company may be economical for you as compared to hiring and paying staff for maintenance and cleaning.