Leasing Restaurant Equipment to Lower Expenses
Owning a restaurant can be a difficult business. It can be a challenge to find the find balance of spending enough to keep the business afloat without compromising the financial prospects. This is especially true in the first few years of operation. One of the biggest restaurant expenses is the equipment. Restaurant appliances and equipment are absolutely necessary, yet they can be extremely expensive. One way to offset the large cost is to consider leasing restaurant equipment instead of buying it.
You can find leasing options for most types of restaurant equipment. A few popular items to lease are kitchen appliances such as ice makers or dishwashers. Many restaurant owners also choose to lease computer systems. When it comes to leasing restaurant equipment, its best to choose items that depreciate quickly or become obsolete every few years. When you lease instead of buy, you preserve your financial security and maintain a safety net in the event of any problems or unforeseen expenses.
Most lease agreements for restaurant equipment run over a period of several years. When the lease term expires, you have several options. You can return the equipment as long as it is in good condition. If you are happy with the equipment, you can choose to arrange a buyout agreement with the leasing company. You can also continue leasing equipment by signing a new contract for updated appliances.
If you want to compare the financial costs between leasing restaurant equipment and buying it, you’ll need know the approximate amount of the lease payments. As a general rule, lease payments are based on the length of the lease agreement, the total cost of the equipment, and your credit score. For example, if you have good credit, you can lease $20,000 worth of equipment for five years with a monthly payment of $450 to $500. Of course, the exact terms of a lease agreement are determined by the lessor for each individual case.
Another way that leasing saves you money is related to maintenance and repairs. When you are leasing equipment, the terms of the agreement usually cover wear-and-tear, maintenance, and repairs. This means you won’t face any extra costs to repair the leased equipment during the course of normal operation.
Leasing restaurant equipment can be a great way to keep your restaurant financially solvent, especially in the first few years of operation. Most people choose to lease equipment that becomes out-of-date every few years. Leases generally run for a few years and the terms are based on the cost of the equipment and your credit history. Leasing saves you from having to pay the full purchase price of the equipment and from standard repair expenses.