01827 68939
info@shireleasing.co.uk
lockShire Online - Login
Twitter
LinkedIn
Shire Leasing logoShire Leasing white logo
  • About Us
    • History, Vision & Values
    • Meet the Team
    • Affiliations
    • Corporate Social Responsibility
    • Stakeholders (Section 172 Statement)
    • Career Opportunities
    • SME Finance Charter
  • Customer Finance
    • Types and Solutions
    • Vehicle Finance
      • Vehicle Solutions (existing customers)
      • Clean Air Zone Financial Assistance
        • Bath & North East Somerset
        • Greater Manchester
    • What Can Be Financed?
      • Catering | Restaurant Equipment Leasing & Finance
      • Gym Equipment Leasing & Finance
      • IT Equipment Leasing & Finance
      • Printing Equipment Leasing & Finance
      • Security Equipment Leasing & Finance
      • Air Conditioning Equipment Leasing & Finance
      • Finance For Farms
        • Farm Vehicle & Tractor Finance
        • Livestock Finance
        • Agricultural Machinery Financing | Agricultural Equipment Finance
        • Farm Diversification Funding
      • Renewable Energy Finance
    • Recovery Loan Scheme (RLS)
    • New Business Equipment Financing
    • Shire Members’ Club
    • Make a Payment
    • Testimonials / Case Studies
  • Supplier Finance
    • Services and Technology
    • Industry Specialisms
    • Training (Lead with Lease)
    • Case Studies & Testimonials
    • Supplier Support Portal
  • Blog
  • Resources
    • Resources & Guides
    • Videos
    • FAQs
    • Industry Terminology
  • Contact Us
Leasing kitchen equipment

Costs and Benefits When You Lease Kitchen Equipment

04 NovShire Leasingbusiness growth, Equipment Finance, Equipment Lease, leasing, SMEs, Start-UpsNo Comments

If you’re wary of protecting your existing capital, you should consider leasing your kitchen equipment rather than buying it outright. However, it’s a decision that every business should make based on their individual circumstances because – like any type of finance – there are both costs and benefits associated with leasing.

The best decisions are always those which are fully informed. With that in mind, here are some of the costs and benefits of leasing for you to weigh up…

leasing-kitchen-equipment

Benefits of leasing kitchen equipment

Keep cash in the bank

As a small business, you often have to make limited capital go a long way. As much as anything else, it helps with peace of mind knowing that you’re not having to think about going into an overdraft or taking out other lines of credit.

By leasing your kitchen equipment, you can keep your cash in the bank, with more manageable monthly payments to think about (which you can budget for) instead of large lump sums.

Meet short-term demand

Sometimes it’s not possible to predict an increase in demand, and scaling up the business to meet it can prove a bit of a risk if the demand isn’t sustained.

Buying equipment outright is reliant on you generating enough revenue to cover the purchase cost long-term, otherwise you potentially have equipment/machinery that’s not proved to be a sound investment.

When you lease the equipment, it’s often less risk as you’re not handing over a large sum of money upfront. You have the benefit of spreading your costs, and if the equipment helps to generate revenue, it could be used cover its own rental costs. Furthermore, if the demand doesn’t sustain, you can hand the equipment back at the end of the lease agreement (subject to the terms and conditions of agreement). 

Flexible end of term options

If the demand does sustain, however, and you’ve become reliant on the commercial kitchen equipment you’re leasing to serve customers, you are often presented with the option to continue paying rentals and extend the usage of the equipment. 

You can choose whether you take up that option or not. Alternatively, you might want to return the equipment and upgrade to a newer option, or something to help cope with the demand and increase output. This element of flexibility is essential for any business where demand can fluctuate.

Costs of leasing kitchen equipment

Fewer assets to use for future processes

Leasing isn’t for everybody. Some business owners prefer to have equipment that they can call their own – the equity from which can be used to buy a new unit when they need to upgrade.

However, you need to be a fairly cash rich business to be able to buy all your commercial kitchen equipment outright – when you total the cost of ovens, fridges and everything else it takes to fulfil your service, you’re well into the tens of thousands of pounds (depending on the size of your business).

Monthly payments can rack up

While there are obvious advantages from being able to split your costs into fixed monthly payments, they can start to rack up if you lease all of your equipment.

There’s an argument, then, for leasing only the big-ticket items and using your cash to pay for the more affordable equipment – that way your outgoings each month will be lower and easier to manage.

Is leasing right for your business?

Unless you know that your business has enough cash reserves to purchase equipment and it can absorb the costs around asset depreciation, then leasing may be the solution for you. In a competitive market, leasing new and upgraded equipment can help you stand out from your competitors.

If you would like more information on how leasing could benefit your company, get in touch with Shire Leasing’s finance experts who can help find the right solution for your business goals.

prev Shire Leasing picks up two prestigious industry awards next Should You Lease an Office Printer?
Shire Leasing

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Quick Links

  • FAQs
  • Career Opportunities
  • Terms & Conditions
  • Privacy Policy
  • Fair Processing Notice
  • Make a Complaint

Get in Touch

Registered Office:
1 Calico Business Park
Sandy Way
Tamworth
Staffordshire
B77 4BF
CONTACT US

Shire Leasing PLC is Authorised and Regulated by the Financial Conduct Authority for certain types of consumer credit lending and credit related activities that are regulated under the Consumer Credit Act 1974 and by the Financial Services and Markets Act 2000. For certain types of products Shire act as a lender and a broker and for some products we act as a broker only. Our firm reference number is 313055.

Twitter
LinkedIn

 

Tel: 01827 68939
Email: info@shireleasing.co.uk

Registered in England and Wales
No02476571

VAT registered 558 894 080

Registered with the Information Commissioners Office Z4611407

HomeAbout UsBlogContact Us
© 2017 All rights reserved. Site by Catalyst
This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish.Accept Read More
Privacy & Cookies Policy

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are as essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may have an effect on your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
SAVE & ACCEPT