Coffee Machine and Equipment Leasing
I have been a consultant involved in the Coffee World for some years, advising clients and helping them choose the right equipment to suit their needs. Equipment can of course be purchased with good old fashioned cash or a Business Loan from your Bank. However, the latter is not so easy these days. Another alternative that has seen growth in the last few years is Equipment Leasing. Leasing is available in many countries and certain Terms and Conditions vary. Tax benefits that Leasing can bring also vary from country to country. I can only speak from my knowledge of the UK market. I advise clients on many Coffee Machine Leasing packages to suit all their business needs. One thing the client doesn’t always realise is that they can add other equipment requirements to their Lease Agreement. For example; Kitchen Equipment, “front of house” equipment and fittings. You name it – It can be Leased.
What is Equipment Leasing?
Equipment Leasing is the process of securing the use of pretty much any type of equipment these days; Office equipment, Computers, various types of machinery. Within the Catering Industry this could mean EVERY piece of equipment used in the kitchen and “front of house”. Ovens. Toasting Ovens. Refrigeration. Ovens and Cooking ranges. Deep Fat Fryers, Food processors etc. Front of house equipment would not only include the very important COFFEE MACHINE, but may also include Panini Grills. Counters. Refrigerated Serve Over Counters. Tills. EPOS systems. Leasing can even be used to finance fabrication works, shop fittings, shop furniture, tables and chairs. Even structural building works can be Leased. All these things are needed but cost money, which is not always readily available. Therefore Leasing can provide the financial means to get the right equipment when opening a new coffee shop, restaurant etc. The other benefit is that Leasing can relieve cashflow. For established businesses Leasing can be used to refurbish and replace equipment.
By entering into a Lease contract to utilize equipment for a specified period of time, a business or individual can enjoy the benefits of usage without having the need for a large capital injection of CASH! Many industries make use of equipment leasing. In some instances, choosing to lease necessary equipment and machinery is an ideal situation for new or established businesses with very little working capital. Rather than investing large amount of limited resources, leasing necessary equipment makes it possible to secure more up to date models and focus on the task of growing the business.
The Changing Face of Finance
Equipment leasing and equipment finance has changed greatly in the UK in the last few years. The main change, as many business owners are painfully aware, is the lack of availability of funding and finance from the High Street Banks! Although this situation can also affect Leasing, Lease companies also have access to many other friendly industry capital funders. However, some funders will only finance established businesses. A bit of a “Catch 22” situation. This is not always the case with Leasing. However, you have to find the right Lease Company. Some 75% of all Leases that I have arranged over the last few years have been for “New Start” businesses.