All business owners starting up an eatery or venturing into F&B industry needs commercial kitchen equipment. Here we will breakdown the category as used, brand new and to lease equipment pricing. Before that, let’s go through some of the advantages and disadvantages of each category.

One key consideration for equipment leasing is cash flow. Daily usage of raw material uses a big amount of cash. This also includes operation costs; utilities, manpower, renovation, taxes, etc. A famous phrase, “Cash is king” holds very true to business survival in F&B industry for first 2 years.

Brand new

Used

Lease
Warranty
Typically 6 months to 1 year		 At most 3 months Warranty included during lease term
Condition
Tip top condition
Minimal dents		 Depends on luck Good working condition
Disposal
Approximately 50% of purchase price
2 weeks to 2 months with advertising cost		 Possibly at same purchase price
2 weeks to 2 months with advertising cost		 Fuss free. Just return almost immediately.
Possibly forfeit 1-3 months of lease deposit depending on lease terms
Cost
Eg. A 2 doors work table chiller
SGD2000 to SGD3000 depending on equipment maker		 SGD800 to SGD2000 SGD80 to 300 a month depending on equipment maker
Risk v cost
High		 Medium Low
Alteration
Yes		 Yes No

A typical lifespan of a commercial kitchen equipment is ~3-5 years depending on the maker. Some could go as far as 10 years. Equipment breakdown requires skilled labor to fix. Skilled labor is scarce and cost of repair could go in the range of hundreds. This is provided if you could get someone to repair. Lead time for repair is easily a day. Take note, leased equipment has penalties if equipment was found misused. At end of day, you could renegotiate on lease price and terms if you are unsatisfied.

Definitely to lease equipment for short events ranging from 3 days to a week. Before deciding to buy a deep fryer for an event, do consider the warehouse or storage of equipment. Another key consideration is logistic cost. Getting mover to move an equipment in Singapore is costly. You can choose to maximize profit from an event rather than be hindered with equipment limitations and logistics.

Ultimately, it depends on individual. Equipment leasing provides the most fuss free and cost effective to start up a food business. In long term, leasing will cost more and warrants any equipment breakdown. If you have cash and confidence in your F&B business, buying new equipment will be more cost effective in the long run.