Restaurant Equipment Rentals: Opening a new restaurant or replacing existing a craft cocktail ice machine always begs the question – “Buy or lease?” Because cash flow is king in the restaurant business, the answer to the Buy vs. Lease question is increasingly “lease.” When you have fixed, low payments for equipment, you’re able to preserve capital for slow times and keep cash in the bank for marketing or for unexpected expenses or repairs.
Restaurant equipment rentals are available for virtually all of the major appliances:
You may want to introduce new menu items that require extra capacity for refrigeration or freezing. Leasing an additional piece of equipment is a great way to expand your kitchen capacity without a significant investment. And, leasing doesn’t typically affect your bank credit, keeping even more cash available. (Just make sure to stay current on payments to maintain a good credit rating.) Before you sign a rental agreement, make sure to:
- Compare several equipment rentals terms. The monthly fee may vary on the same piece of equipment.
- Agree on service terms for the equipment. Find out what is included, such as general maintenance and/or cleaning. Ask about the fee for services not covered in the contract.
- Understand the options for length of lease, early termination, and purchase availability at the end of the lease.
- Do the research on the leasing company’s recommended manufacturer. Their rentals should be available for whichever manufacturer you want, and you want a reliable piece of equipment.
- Remember that you don’t own the equipment, so restaurant equipment rentals are not able to be considered for collateral when you’re applying for a loan.
Benefits of Restaurant Equipment Leasing
Save on cash flow – Monthly payments are lower than buying, and the amount is predictable. No fluctuations in amount due to interest rates.
Eliminate a large down payment – Typically, you only pay a first payment when signing a lease.
Schedule payments for flexibility – Terms of leases can vary. For example, you can arrange to pay more in the summer if that’s your busy season, with lower payments in slower winter months.
Immediate fulfillment – Most leases are approved quickly. Equipment you need can be delivered to your restaurant in a timely manner. No delays while you wait for financing decisions.
State-of-the-art equipment – Go for all the bells and whistles you want, and a lease is still affordable. And, after the lease, you can rent the next generation equipment.