Restaurant equipment is expensive but essential. Here's how to finance it smartly:
Common Equipment Costs:
- ●Commercial oven: $5,000 - $30,000
- ●Walk-in cooler: $5,000 - $15,000
- ●Refrigeration: $2,000 - $10,000
- ●Dishwasher (commercial): $3,000 - $15,000
- ●POS system: $1,500 - $10,000
- ●Ice machine: $2,000 - $8,000
- ●Fryer: $1,500 - $5,000
- ●Full kitchen buildout: $50,000 - $200,000+
Equipment Financing Options:
Equipment Loan:
- ●Borrow to purchase equipment outright
- ●Equipment serves as collateral
- ●You own it after payoff
- ●Good for: New equipment with long useful life
Equipment Lease:
- ●Monthly payments to use equipment
- ●Options at lease end (buy, return, upgrade)
- ●Often includes maintenance
- ●Good for: Technology that becomes outdated
Typical Terms:
- ●Amount: $5,000 - $500,000
- ●Down payment: 0-20%
- ●Terms: 2-7 years
- ●Rates: 6-25% depending on credit
Tax Benefits: Section 179 deduction allows you to deduct the full purchase price in the year of purchase (up to limits). This can significantly reduce effective cost.
Tips for Restaurant Equipment Financing:
- ●Get multiple quotes for equipment
- ●Consider used/refurbished for some items
- ●Finance mission-critical items, pay cash for small items
- ●Match loan term to equipment useful life