If you have a food service business, you have probably realized that there’s more to having a food service business or franchise than just maintaining a place and cooking some dishes within it. You’re probably realized that there are a lot of things that you need and don’t currently have, such as freezers and other kitchen equipment and you have most likely come across the dilemma of whether to rent or buy them.
It all stars with you taking a step back and reassessing your business, or lack thereof. What exactly is it do you need? What risks are you willing to take? Simply put, if you are able to wait and add a few more bucks to your initial capital, you can purchase every type of equipment you need. If you are just missing one piece of equipment, or just need an extra display fridge for instance, then it may be better to just rent it just for operations to continue.
Buying is a lot more favorable if you are a completionist. Simply put, if you just want to get everything over with and not want to worry about having to pay the lease for any equipment you may have rented, then buy it. If your business can survive without a freezer for a few weeks, for instance, then you can forgo renting and just hold on until you have enough to buy it.
Renting is a better choice if you do not want to stop operations. Let’s say your old freezer breathed its last breath and you don’t have enough to buy a brand new one. You also can’t afford to close down your business. This would be a good time to consider renting a freezer instead. Your business continues to operate while you’re saving up for a brand new freezer.
There are a few pros and cons with each choice, though. For instance, when buying additional equipment, you may take a huge chunk off of your profits for the purchase. When renting equipment, your profits drop a little since a small portion of it goes into paying for the lease. Simply put, renting adds more figures into the expenses column of your ledger.
Still, it all depends on your situation. Assess your business situation and base your decision of either buying or renting from that. At its simplest, buy the equipment if you can afford it and rent it with the intention of buying it in the future if you can’t afford it for now.