Recently, our VP Cory Damm provided valuable advice on equipment financing for franchisees and restaurant owners on premier restaurant industry news site, Fast Casual.
The feature outlines the high price of equipment, and suggests leasing and financing as smart, cost-effective and savvy alternatives to purchasing outright. Two pieces of advice Cory offers for those considering these alternatives are:
1) High-dollar, short-life equipment might be a better deal when leased
The ice machine is broken … again, right? Maybe it’s trying to tell you something. According to Damm, items with notoriously short life spans, like ice machines, can be good candidates for leasing since they often come with maintenance contracts that will sub a machine if one of yours goes down.
In fact, Damm said that the three main types of equipment restaurant chains most frequently lease from LeaseQ involve lots of technical maintenance or know-how (e.g., some point-of-sale systems), or heavy maintenance to ensure safe and accurate operation (e.g., refrigeration and ware-washing).
“All of these machines typically need constant maintenance and/or replacement on 5-year cycles, which make them natural assets for acquisition by lease,” he said.
2) Enter a lease with eyes wide open
Know what services are provided by your leasing arrangement, how often they are rendered and by whom. For instance, if the item you’re leasing requires constant recalibration, cleaning, refilling or other upkeep, make sure that your lease clearly delineates exactly what is provided, how often and by what kind of professional. It could make the difference between a deal and a dead, or even deadly, end.
To read the rest of Cory’s advice, please visit: http://www.fastcasual.com/articles/working-story-to-lease-or-not-to-lease-if-that-is-the-question-part-1/