Running a successful restaurant requires top-quality equipment, but purchasing it can prove to be expensive. Whether you are opening a new restaurant or upgrading your current kitchen equipment, securing the right financing can be a daunting task.
We've partnered with Mill Wood Finance, specialists in providing tailored finance solutions for restaurant equipment, especially the difficult applications that other lenders might shy away from.
In the UK there are several types of financing solutions that can be used to fund restaurant equipment purchases. Each option comes with its own set of advantages and disadvantages, and your eligibility and suitability will differ accordingly.
Operating lease: An operating lease will enable restaurants to rent equipment for a fixed period of time, without owning the piece of equipment. At the end of the lease term, the equipment is returned to the lender. This finance solution is ideal for businesses that upgrade equipment regularly.
Using a finance lease, the restaurant operator will rent the equipment for the duration of the useful life. Whilst the restaurant will not own the equipment, they would be responsible for maintenance and other related expenses.
With a hire purchase deal, the restaurant will receive the equipment upfront whilst spreading the cost over a certain fixed period. Importantly, the restaurant will own the equipment after the final payment. This is a good option for those who want to eventually own the equipment without making a large upfront payment.
An asset finance solution enables businesses to use the equipment itself as security for a loan. This reduces the risk for the lender, which can lead to more favourable terms for a loan.
Both secured and unsecured business loans offer a potential financing solution for restaurant equipment. Unsecured loans do not require collateral, but often come with higher associated interest rates compared to secured loans that are secured against a business asset such as property.