Key Takeaways
- Packaging equipment for food businesses allows companies to acquire equipment without significant upfront costs.
- With proper packaging equipment, food businesses can increase efficiency, improve product quality and branding, and stay compliant with regulations.
- Food businesses can choose between chattel mortgages and finance for overseas purchases to suit their equipment needs.
- Interest rates for packaging equipment loans in Australia can range anywhere from 6% to 15%, depending on factors like the loan term, the cost of the equipment, and the business's financial profile.
- Food manufacturers may be eligible for grants like the Industry Growth Program, Manufacturing Hubs Grant Program, and Certain Inputs to Manufacture Program to reduce equipment costs.
- Our Equipment Finance Calculator in Australia helps estimate loan repayments, helping you plan for financing.
- Engaging a finance broker like Dark Horse Financial can help food manufacturers secure the best loan terms and understand financing options.
Running a successful food business in Australia requires efficient, high-quality packaging solutions. Whether you’re a small-scale producer or a large food manufacturer, investing in the right packaging equipment can enhance productivity, improve shelf appeal, and ensure compliance with food safety standards. However, purchasing packaging machinery outright can be quite expensive.
With flexible funding options such as packaging equipment loans, leasing, and chattel mortgages, Australian food businesses can get the machinery they need without straining cash flow. Let’s explore the best packaging equipment finance for food businesses, loan options, leasing alternatives, interest rates, and even potential government grants.
Understanding Packaging Equipment Financing in Australia
Packaging equipment loans refer to financial products designed to assist businesses in acquiring machinery and technology used in the packaging process. These financial solutions enable companies to spread the cost of equipment over a period, making it more manageable and preserving working capital for other operational needs.
Why Packaging Equipment Finance is Essential for Food Businesses
The food industry is highly competitive, and packaging plays a crucial role in product preservation, branding, and compliance. Investing in modern packaging machinery—such as filling machines, sealing equipment, labelling systems, and vacuum packers—can help businesses:
- Increase efficiency: Automated packaging reduces labour costs and speeds up production.
- Improve product quality: Advanced machinery ensures consistency and extends shelf life.
- Meet regulatory standards: Compliance with Food Standards Australia New Zealand (FSANZ) is non-negotiable.
- Enhance branding: Professional packaging improves customer perception.
However, purchasing this equipment outright can be costly, with some machines costing tens or even hundreds of thousands of dollars. Packaging equipment financing for food businesses provides a viable solution, allowing companies to spread the cost over time while still benefiting from the latest technology.
Types of Packaging Equipment Finance For Food Businesses
When considering loans for food packaging machinery, businesses have several financing options to choose from. The best choice depends on cash flow, tax considerations, and long-term business goals.
1. Equipment Loans (Chattel Mortgage)
A chattel mortgage is one of the most common forms of packaging equipment financing in Australia.
Under this structure:
- You take ownership of the equipment from day one
- The equipment serves as security for the loan
- You can claim GST, depreciation, and interest expenses (if you’re GST-registered)
This option is ideal for businesses that want long-term ownership of the asset and seek tax advantages.
2. Leasing Options
Can food manufacturers lease packaging equipment instead of buying? Yes, they can. Leasing allows businesses to use equipment for a specified period while making regular lease payments. At the end of the lease term, businesses may have the option to purchase the equipment, renew the lease, or return it. Leasing can be good for businesses that require flexibility, wish to avoid the responsibilities of ownership, or prefer to have the option to upgrade equipment regularly.
3. Finance for Purchasing Equipment Overseas
Many food packaging machines with better quality and prices are available for purchase overseas. We can tailor financing solutions for food processing equipment that allow you to make these large purchases. You use a trade finance facility to purchase equipment, and once customs clears it, you use equipment finance to pay off the trade finance facility. This unique solution is tried and tested—you can contact our team to learn more.
How to Finance Packaging Equipment for Food Businesses
If you’re wondering how to get a loan for packaging equipment, follow these steps:
- Assess Your Equipment Needs: Determine the type of machinery required (e.g., vacuum sealers, labelling machines, shrink wrappers). Consider whether new or used equipment is better for your business.
- Apply Quickly Online: Use our online form and apply within minutes. We’ll give you a swift response, and we can discuss your borrowing needs and your financial situation.
- Submit Your Application: After our discussion, we’ll submit an application on your behalf. Some approvals can occur in just a few hours.
- Finalise the Agreement and Acquire Equipment: Review the loan or lease contract carefully. Once approved, your funds will be disbursed, allowing you to take possession of the machinery.
What Are the Interest Rates for Packaging Equipment Loans in the Food Industry?
Interest rates for packaging equipment loans in Australia vary based on:
- The loan amount
- Your credit and financial profile
- The loan term
- The type of financing product
- The age and type of equipment
- The lender’s policy
Typical interest rates for equipment finance range from 6% to 15% per annum. However, rates can vary greatly from lender to lender. If you want to secure the lowest possible rates, contact our team to get help.
Are There Government Grants for Food Packaging Equipment Financing?
1. Industry Growth Program
This program offers an Advisory Service for startups and small to medium enterprises (SMEs) engaged in innovative commercialisation and growth projects within the priority areas of the Australian Government’s National Reconstruction Fund (NRF). If your food packaging business is involved in innovative projects that align with the NRF priority areas, you may be eligible for this program.
Support Provided:
- Advisory Services: Access to specialized advice to support commercialisation and growth opportunities.
- Grants: Following the advisory phase, businesses may apply for:
- Grants ranging from $50,000 to $250,000 for early-stage commercialisation projects
- Grants between $100,000 and $5 million for commercialisation and growth projects
- Grants ranging from $50,000 to $250,000 for early-stage commercialisation projects
Eligibility Criteria: Must be an SME with an innovative project that contributes to building manufacturing capability in one or more of the NRF’s priority areas.
Application Details: Applications are open on an ongoing basis
More Information: Industry Growth Program
2. Manufacturing Hubs Grant Program (Queensland)
This program provides matched funding to regional Queensland manufacturing SMEs to enhance advanced manufacturing capabilities.
Food packaging businesses located in eligible Queensland regions can apply for funding to adopt new technologies, undertake skills training, and pursue business development initiatives.
Support Provided: Matched funding between $10,000 and $500,000
Eligibility Criteria:
- Must be a Queensland-based SME primarily engaged in manufacturing
- Main operations should be in eligible Queensland regions such as Cairns, Townsville, Central Queensland, Mackay, and the Gold Coast
- Must have been operating within Queensland for at least three consecutive years
Application Details: Applications are open until June 30, 2025, or until all funding is allocated.
More Information: Manufacturing Hubs Grant Program QLD
3. Certain Inputs to Manufacture (CIM) Program
The CIM program offers import duty concessions to Australian manufacturers for eligible goods that provide a performance advantage over locally produced alternatives.
If your business imports metal materials or goods used in food packaging that are not available domestically or offer significant performance advantages, you may benefit from this program.
Support Provided: Reduction or elimination of import duties on eligible goods.
Eligibility Criteria:
- Must intend to import eligible goods for use in manufacturing a specific end product
- Must demonstrate that the imported goods offer a substantial performance advantage over Australian-produced substitutes
Application Details: Applications can be submitted at any time before importing the goods.
More Information: Certain Inputs to Manufacture (CIM)
Additional Resources
To explore more grants and programs that may suit your food packaging business, consider using the Grants and Programs Finder on business.gov.au. This tool allows you to filter and identify funding opportunities tailored to your business needs.
Disclaimer: As of writing, the above grants are open for applications. However, grant availability and eligibility criteria can change at any time. It’s advisable to regularly check the official websites or contact the relevant program administrators for the most current information.
How An Equipment Finance Calculator in Australia Can Help
Choosing financing for your food business involves careful budgeting and planning. An equipment finance calculator allows you to estimate monthly repayments to ensure it’s the right solution for your business. Just input the loan amount, interest rate, loan term, and any balloon payment (if applicable) and get an estimate.
Disclaimer: Our equipment finance calculator provides general estimates based on standard assumptions, including interest rates, loan terms, and financing structures. The results are indicative only and do not constitute a formal quote or financial advice. Actual loan terms, rates, and repayments may vary depending on your business’s financial circumstances, credit assessment, and lender policies.
Affordable Equipment Loans for Food Manufacturers: Choosing the Right Option
What are the best loan options for food packaging machinery? Selecting the best and most affordable option depends on various factors, which can include the business’s financial situation, equipment requirements, and long-term objectives.
To choose the most affordable financing, contact our team at Dark Horse Financial. With our wide network of lenders, we can find the right one that offers the financing you need with the lowest rates possible for your situation.
Final Thoughts
With packaging equipment financing in Australia, companies can acquire high-quality machinery without depleting working capital. Whether through packaging equipment loans or leasing, there’s a solution to fit every business.
Equipment loans are suitable for businesses seeking full ownership and having the capacity to manage regular repayments. Leasing is ideal for those requiring flexibility and preferring to avoid ownership responsibilities. Additionally, exploring government grants can provide financial relief.
If you’re ready to explore loans for food packaging machinery, contact Dark Horse Financial today for expert advice and competitive financing options tailored to the Australian food industry.
