Key Takeaways
- Restaurant equipment financing refers to a loan or lease option designed to help businesses purchase or upgrade kitchen equipment without paying the full cost upfront.
- No doc equipment financing up to $500,000 is available to business owners.
- Restaurant equipment loans preserve cash flow, provide access to modern equipment, and offer tax benefits, making it especially ideal for new or growing restaurants.
- Financing covers cooking appliances, refrigeration, food prep tools, dishwashers, beverage systems, ventilation, and even POS systems.
- Going for financing options improves efficiency, enhances customer experience, and provides financial flexibility, helping you stay competitive in the food industry.
- Options include chattel mortgages and leasing solutions, each with unique benefits and drawbacks.
- To qualify for business equipment financing, determine your borrowing needs, prepare financial documents (for full-doc loans), and check your credit score.
- Work with a trusted loan expert like Dark Horse Financial to find the best financing solution tailored to your business needs.
Running a successful restaurant in Australia requires more than just a passion for food and excellent customer service. It demands the right tools, equipment, and infrastructure to ensure everything’s smooth sailing. With the right equipment, you can maintain food quality and meet and exceed customer expectations. However, many business owners struggle to acquire high-quality restaurant equipment because of the cost. This is where restaurant equipment financing can help.
Let’s explore everything you need to know about restaurant equipment loans in Australia, including how it works, the benefits, what you can fund with it, and how to secure the right loan for your business.
What is Restaurant Equipment Financing?
Restaurant equipment financing is a type of business loan specifically designed to help restaurant owners purchase or lease the equipment they need to operate. This can include everything from ovens, refrigerators, and dishwashers to furniture, POS systems, and even food trucks. Instead of paying the full cost of the equipment upfront, business owners can spread the cost over time through manageable monthly payments.
In Australia, restaurant business equipment financing is offered by both traditional and non-traditional lenders. Banks may offer low rates and higher loan amounts, but specialised non-bank lenders can offer more flexibility, will fund a broader range of equipment, including new and secondhand and offer approvals within hours or days.
Why Do You Need Restaurant Equipment Loans?
Here are some reasons why restaurant equipment financing is a smart choice:
- Preserve Cash Flow: Purchasing equipment outright can drain your working capital, leaving you with limited funds for other critical expenses like payroll, inventory, and utilities. Financing allows you to preserve your cash flow while still acquiring the equipment you need.
- Access to Modern Equipment: The food industry is highly competitive, and having outdated equipment can put you at a disadvantage. Financing enables you to invest in the latest technology and equipment, helping you stay ahead of the competition.
- Tax Benefits: In Australia, equipment financing may offer tax advantages, reducing your overall tax liability.
- Flexible Repayment Options: Many lenders offer flexible repayment terms, allowing you to choose a plan that aligns with your business’s cash flow and revenue cycle.
- Quick Access to Funds: Depending on the lender and the loan amount, restaurant equipment loans can be approved and funded quickly, ensuring you get the equipment you need without delay.
Types of Restaurant Equipment You Can Finance
Here are some of the typical industrial kitchen equipment you can acquire with a restaurant equipment loan in Australia:
- Cooking Equipment: Commercial ovens, ranges, stovetops, fryers, griddles, flat tops, stovetops, steamers, and microwaves
- Refrigeration Equipment: Walk-in coolers or freezers, reach-in refrigerators and freezers, blast chillers, ice machines, and ice cream machines
- Food Preparation Equipment: Food processors, mixers, slicers, blenders, juicers, and meat grinders
- Dishwashing and Cleaning Equipment: Commercial dishwashers, glass washers, industrial grade floor cleaners, pressure washers
- Beverage Equipment: Coffee machines, bar blenders, draft beer systems, soda dispensers, water filtration systems, and slushy machines
- Ventilation and Exhaust Systems: Industrial range hoods and exhaust fans
- Specialty Equipment: Pizza ovens, industrial grillers, rotisserie ovens, waffle makers, sushi conveyor belts, food trucks, and more.
- Technology and POS Systems: Restaurant POS systems, kitchen display systems, inventory management equipment, electronic tablets for tablet ordering systems, etc.
Tips for Choosing the Right Restaurant Equipment to Finance
Before applying for a restaurant equipment loan, it’s important to carefully consider the type of equipment you need. Here are some tips to help you make the right choice:
- Assess Your Needs: Make a list of the essential equipment your restaurant requires. Prioritise items that will have the greatest impact on your operations.
- Consider Quality: While it may be tempting to opt for cheaper equipment, investing in high-quality, durable items can save you money in the long run by reducing maintenance and replacement costs.
- Think About Energy Efficiency: Energy-efficient equipment can significantly reduce your utility bills, making it a cost-effective choice in the long term.
- Plan for the Future: Choose equipment that can accommodate your business’s growth. For example, opt for a larger oven or refrigerator if you plan to expand your menu or increase your customer base.
- Compare Prices: Shop around to find the best deals on the equipment you need. Don’t forget to factor in delivery and installation costs.
Types of Restaurant Equipment Financing in Australia
When it comes to restaurant equipment financing, there are several options available to Australian business owners. Each option has its own advantages, so it’s important to choose the one that best suits your needs.
Chattel Mortgages
A chattel mortgage is a type of loan specifically for movable assets like restaurant equipment. The equipment serves as security for the loan, which often results in faster turnarounds and lower interest rates.
Some distinct advantages of a chattel mortgage are that you own the equipment outright, and you can use it immediately to get your operations rolling. You can get potential tax benefits, decreasing your tax liabilities.
Equipment Leasing
Leasing is another popular option for restaurant equipment financing. Instead of purchasing the equipment, you rent it for a specified period. At the end of the lease term, you can either return the equipment, renew the lease, or purchase the equipment at a reduced price.
Leasing can be less expensive upfront than mortgaging equipment; however, it can cost more in the long run. It can be a great choice for those looking to upgrade equipment frequently. However, you don’t own the equipment from the start and can only own it if you decide to purchase it at the end of the lease.
How to Qualify for a Restaurant Equipment Loan in Australia
Securing a restaurant equipment loan in Australia is easy with the help of experts like Dark Horse Financial. Lenders will evaluate your application based on several factors, including your credit history, business performance, and the type of equipment you’re financing. With our help, the process can be quick and simplified.
Here are steps you can take to improve your chances of approval:
- Get Professional Help: We specialise in providing customised loan solutions with the best rates and terms. We’ll compare lenders and loan products on your behalf to ensure that you get the best deal. We’ll guide you through the whole process, from discussing your needs to signing the loan agreement and beyond.
- Determine Your Borrowing Needs: Before applying for a loan for restaurant equipment, ensure that you know exactly how much you need. Tell us what equipment your business needs and factor in the cost to have them delivered and installed.
- Check Your Credit Score: A strong credit score is essential for securing favourable loan terms. Check your credit report and address any issues before applying. If you have a poor credit score, you can always go for bad credit loan options. We’ll help you get the lending you need based on your credit score.
- Prepare Requirements: Lenders will want to see proof of your business’s financial health. For full-doc loans, this may include bank statements, tax returns, and business financials. For low or no-doc loans, you can access up to $500k in lending, which will be assessed through your bank statements and credit score.
Final Thoughts
Restaurant equipment financing can be the key that helps you unlock your restaurant’s full potential. Whether you’re opening a new establishment, upgrading your kitchen, or expanding your operations, the right financing solution can provide the funds you need to succeed.
By understanding the different types of restaurant equipment loans available, choosing the right equipment, and seeking professional lending advice, you can set your business up for long-term success.
Get the Equipment You Need for Your Restaurant Business
At Dark Horse Financial, we specialise in helping Australian businesses secure the financing they need. Contact us today to learn more about our business equipment financing options and take the first step toward achieving your restaurant’s goals.
