Here is what the team at Bristol Twenty have to say about this . . .

Whether you are upgrading your equipment or looking for the best coffee machine deals to open your café, many people are surprised to find the number of options open to them. Customers often ask us “what are the key differences between leasing, renting, or purchasing a commercial coffee machine?”, and specifically “will I get more support if I lease a coffee machine?”

The simple answer to the last question is ‘no’ but to unfold that response, here we take you through renting, leasing and buying your espresso machine outright and their advantages and disadvantages. Once you are aware of the benefits and constraints of each option, you can make an informed decision on the three types of purchase methods. Before comparing the three options in question, it is important for you to first get a clear idea of what each of these coffee machine services encompasses.

Renting

This option is often most popular with people opening a coffee shop, especially for the first time.  This is when you pay a monthly fee for the use of the espresso machine, but you never own it. The advantages of the rental option are more flexibility; you can rent a particular model for a short period of time and assess whether it works well for you and accessibility; there is a small deposit to pay but you are tied into a far less time period than a lease option.  Also with rental all maintenance and servicing of the machine, including water softener exchanges, is included in the deal, taking away the stress of a breakdown. The main disadvantage of renting is that at the end of your rental period, you do not have the opportunity to buy the coffee machine, and it must be returned to us when finished with. This solution is not the most profitable in the long run, as continuous renting over a period of many years can work out to be the more expensive option.

Leasing

This option is when you pay a deposit upfront and monthly instalments to pay off the cost of the machine.  At the end of the agreement, the equipment belongs to you. The main advantage of leasing your espresso machine is having new equipment, when you need it, and spreading the cost. Most people opt for a 3 year lease but there is the option to do a shorter or longer lease period. There are also tax benefits, as it is not an asset owned by you, so it is tax-exempt. If you are VAT registered, you can also reclaim VAT on the agreed monthly repayments. The extra money saved can be used to reinvest in other areas of your business.

Similarly to renting, the main disadvantage of having a lease agreement is that it is more expensive in the long-term, compared to buying the machine outright. You may also be required to pay penalty fees if you want to terminate the contract earlier than the agreed end date. Another disadvantage is that unlike renting the lease option only includes the manufacturer one year parts and labour warranty, so you have to factor in maintenance costs after this period, including all water softener exchanges

Purchasing

Purchasing your coffee machine means you pay one lump sum upfront, and then you own the machine. The advantages of buying your espresso machine outright include being in complete control of what model you want to buy, as you are not restricted to choosing within the range that have the rental and leasing options.

There is also less paperwork involved as you are not required to go through any financial checks, and there are no contractual obligations. All machines will come with a one year parts and labour warranty if you purchase them outright, so you have nothing to think about for that first year. Water softener exchanges are not included in the warranty and would need to be paid for as required.

The initial investment can also be deducted over time through depreciation in your tax returns, but it is limited to capital allowances on purchase.
Buying a coffee machine is a good option if you plan to hold onto the machine for an extended period of time. One disadvantage is that maintenance and servicing is not part of the package after the one year warranty. Should your new machine break down or have any faults, after the warranty period, you will have to pay to get it fixed and for any required ongoing maintenance.

So, should you rent, lease, or purchase your coffee machine?

As we have discussed, all three options have their pros and cons, and making this decision will be based on your budget and how you plan on utilising the coffee machine. Consider which option would work best for the environment it is needed for?

Many people start with renting a machine, and once their business has grown, they opt to extend their contract. Some prefer to lease as they want to continuously upgrade their machine without being tied down to a specific model, whilst some want the feeling of ownership with the machine and prefer to buy it outright. At the end of the day only you have the knowledge of your own establishment, so take this guide and apply whichever route is the best choice and most fitting for you.

The team at Bristol Twenty Coffee is always available to advise, guide and assist you with solutions that will meet your requirements – whatever they are. We have a range of coffee machine services that we also offer.