Should you lease or finance your equipment? Is there an interest rate for kitchen equipment?
Whether you’re a five star restaurant or a more classic diner, restaurants rely on good kitchens to be successful. It doesn’t matter how good your servers are at providing hospitality to customers, the food needs to be top notch for your place of business to be considered worth it, and that’s where the kitchen comes into play.
In addition, many restaurants need the kitchen for laundry as well as dishwashing; the kitchen not only provides food but also the ability to reset tables when customers leave before new customers arrive. The kitchen makes your restaurant work, so making sure you have the best chefs, cooks, dishwashers, equipment, and more for your kitchen is essential.
Hiring is that, and is entirely based on who you hire and quality of work, but there are options as far as getting equipment. After all, you want the best dishwashing machines, ovens, hot holding units, and more as possible, giving all of your workers as much of an edge in producing food as possible.
You want all of your food to be both delicious and quick to be served, and getting good equipment is a big part of this, but should you lease or buy equipment? Is there an interest rate for kitchen equipment leasing or financing?
Should you buy your Kitchen Equipment?
Many business owners debate purchasing their kitchen equipment, because they can claim it as a business asset and spend less money to get the hardware. In addition, the benefit of owning equipment is a luxury many business owners want to afford, and they’ll even fall back on a loan to do so, considering a loan has a low but sometimes doable interest rate for kitchen equipment.
However, interest rates are something that you do want to avoid if you can, so the question is whether or not it’s worth buying the equipment with whatever funds you do have. There are two potential issues with equipment that are unavoidable with a purchase however: all equipment will, after a set period of time, either break beyond repair or become outdated by better equipment.
The downside here is that if you spend a decent percentage of your funds just to get equipment that will not last long, you have essentially spent money to have to spend the same amount of money or more over again within a few years, an extremely unwise move financially.
Most equipment that lasts a long time without having to be outdated is very expensive and you’ll need a lot of it (like ovens), so a bank loan would be necessary, but would it be worth having?
The Interest Rate for Kitchen Equipment Leasing
Looking at leasing, it’s easy to see where leasing can be a more advantageous approach compared to purchasing kitchen equipment. Similar to business assets is tax deductibles, essentially putting money in your pocket from tax returns for having leases.
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A lease gives you benefits such as being able to get an upgrade on your hardware over time, and being able to get it repaired if anything breaks down, allowing you to not have to deal with the headache of replacing your equipment every few years. In addition, at the end of a lease you get the options of either purchasing the equipment at a reduced, haggled price, continuing your lease along with an upgrade on the equipment, or returning the equipment and purchasing your own hardware.
Leasing involves a flat monthly rate, so there’s no interest rate for kitchen equipment leasing; however, the rates do add up over time, leading to the one potential downside of leasing. There are such things as good leases and bad leases just like there are good deals and bad deals; however, a well-prepared business owner who has done their research will be able to know what lease is a good lease and what isn’t.
Knowing how much you should be paying for your equipment and what you should be getting out of your lease is extremely helpful in getting the best deal possible for your business. To learn more about the interest rate for kitchen equipment leasing and financing, click here.