Save Money: Everybody opening up a restaurant faces the same dilemma at some point: whether to buy new or used appliances.
Weighing the pros and cons of each piece of equipment is a delicate art. New pieces of equipment can take up a lot of your budget, but given proper care and maintenance, will last you a long time. Used appliances can be found at a fraction of the cost, but often without a warranty.
1. Make Sure You Get a Good Deal on Your Used Appliances.
The good news is that you don’t have to buy all used or all-new; instead, you can mix and match based on what works for your budget to save money and which pieces of equipment you need. Knowing how to avoid a potential dud when evaluating used pieces is the key to getting a good bargain. You don’t want to pay more than you should if a piece of equipment isn’t in a good and clean condition, or if it looks like it needs repairs.
Examine the equipment in person before buying so you can see the condition for yourself. Or, if you are buying used equipment online, request detailed photos and a written record of any damages. It doesn’t hurt to negotiate, especially if you see any flaws or damage that would need repair.
2. Try it Before You Buy It.
If that certain brand name piece of equipment you dream of having in your kitchen is just too expensive right now, consider getting a used model to save a great deal of money. Plan on upgrading your used restaurant equipment to the new model after a few years of having a successful business, and sell your used equipment to fund it.
3. Buy and Sell.
Buying a brand new appliance — be it a stove, oven, fryer, or griddle — is like buying a new car. The second you drive it off the lot, its value drops tremendously. Once the initial value drops, used equipment will hold on to its secondary value. If you buy used equipment, then you won’t lose much (or any at all) if you decide to sell it and buy something else. That is, as long as you take good care of it.
4. Don’t Rack Up Debt.
Perhaps you are tempted to finance the purchase of a kitchen full of shiny new equipment, however, you might find yourself in a pickle if the business is slower than expected and you still have to make that payment every month. Every restaurant owner is aware of the high failure rate of new restaurants, which is why many opt to buy used equipment when starting out: there is less risk of buying used than using credit to buy new restaurant appliances. Racking up too much debt early on is a risky maneuver for a fledgling restaurant business, and buying used helps to keep startup costs low and manageable.
5. Consider Refurbished Equipment.
If you are concerned about the reliability of buying used, consider looking for refurbished equipment. Refurbished appliances are those that were previously owned and returned to the manufacturer for repair. Refurbished pieces may cost a little bit more than other used appliances, but you’ll still save a fair amount overpaying new.
6. Look at Scratch and Dent.
Another budget-friendly option to save money is buying scratch and dent equipment. Scratch and dent pieces are new appliances that have experienced some minor exterior damage that doesn’t affect the function of the appliance. Prices for scratch and dent can be comparable to buying used equipment, so you might consider both options and find the best deal.
7. Know What You Should Buy New.
There are certain appliances that you should probably avoid buying used as they are more prone to problems than other appliances. Many recommend to always buy a new ice machine and a new fryer. Fryers are often poorly maintained and they are prone to corrosion. Used ice machines are subject to mildew and calcium buildup, which can sometimes be hard to detect until it is already plugged in and operating in your restaurant. Unless you really know what you are looking for, play it safe and buy these two items new to avoid future repair costs to save money.
Putting Your Savings to Work.
The best part about the save money you can save buying used equipment is all that you can do with it. First and foremost, it will hopefully give you a cash cushion in case you do have surprise expenses in the future (which most restaurants do). Or, you might use your savings from buying used appliances to pay off your business loans faster.
There are many ways you can redeploy those savings into the business, whether it be in marketing or investments to the decor and interior design of your restaurant. While it is fun and exciting to buy brand new appliances, deciding to buy used is one of the most practical and responsible decisions you can make it as a restauranteur.