Buy or Lease Commercial Kitchen Equipment

There is a thing that we always repeat when advising restaurant owners on kitchen equipment – it’s a onetime investment so better invest in the best. However, one thing that is understandable is that most people start with a small budget. Due to this reason, they face a very difficult situation of deciding whether they should buy or lease the equipment.

To be honest, each one has its own set of pros and cons. The choice of most suitable option may vary from person to person. It depends on countless factors, including the budget, space and future goals of the owner.
Now, we understand that these statements are doing nothing but further complicating the decision. So, without further ado, let us make a comparison between leasing and buying commercial kitchen equipment.

Leasing

Leasing commercial kitchen equipment means you will be able to use the equipment for a certain period of time. The lease period is usually two to three years. After the lease period ends, the equipment is returned to the owner.
Pros – There are many advantages of leasing the equipment. First of all, you don’t have to pay the full price of the equipment. This way, you can have the highest quality equipment for a fairly low amount of money. By the time the lease ends, the value of equipment has already depreciated a lot but you won’t be the one bearing the loss.
Cons – The only con here is that it won’t be possible for you to replace or change the equipment before the term ends. In case the equipment is damaged or broken before the term ended, you are not likely to get your payment back.

Buying

Buying means to simply ‘own’ the equipment. It may sound very tempting but it also has its downsides. Let’s take a look at its obvious benefits before discussing the drawbacks.
Pros – As a buyer, you are the owner and you won’t have to worry about expiration of the lease. You can use the equipment and sell it whenever you want. The equipment becomes your asset and you can borrow money against it if required.
Cons – One of the major cons is that you need a huge capital to buy your equipment. If your budget is not enough, you will have to compromise on the quality. Also, you are the one who will ultimately be hit by the depreciation.
Apart from these two options, some people also prefer hiring commercial kitchen equipment. In hiring, you pay monthly rent for as long as you use the equipment and then return the equipment when you are able to afford leasing or buying. However, hiring is generally considered a short term solution and that is why it is much preferred by catering services rather than restaurants.