Are you considering purchasing a new point of sale system? Perhaps you are opening a new pizzeria, replacing an old system, or purchasing a new POS for an existing location that’s using pen and paper. What if you don’t have the cash on hand when you need it? You could take out a loan to purchase a new system—but have you considered leasing? Here are 4 benefits of leasing that might help you determine if this option is right for you.
1. Preserve Your Cash
Particularly when opening a new location, there are competing priorities such as: rent, insurance, marketing, inventory, staff wages, and utilities. These things are needed just to get your restaurant operational, and cash flow can be scarce. Leasing a POS system allows you to preserve your capital and spread the cost of the POS over the time of the lease. And for existing locations, leasing allows you to pay for the investment month by month, while realizing the benefits of your investment.
2. Get the POS of Your Choice
A point of sale purchase is not one to be taken lightly. And the least expensive POS may not always be the best fit for your restaurant. Take advantage of the flexibility that leasing allows to make the right choice for your business. Careful selection of a full-featured POS system with reporting, inventory, marketing, and labor management tools can be an investment in the growth of your restaurant, and directly increase profit.
3. Flexible Lease Options
If purchasing the equipment outright is not a favorable option, leasing can provide flexibility for restaurant operators. Two common types of leases are the operating lease and the capital lease. Often offering several end-of-lease options, an operating lease allows the leasing company to rent the equipment to the restaurant owner for a mutually agreed upon term, such as 12 or 24 months. When the term completes, restaurant owners may have the option to buy the equipment at fair market value, extend the lease, or return the equipment. An alternative to the operating lease, a capital lease is also a mutually agreed upon contract where the restaurant owner makes payments for the term of the lease, and is obligated to purchase the equipment at the end for an agreed amount.
4. Tax Advantages
Many restaurant operators also realize tax benefits when leasing a point of sale system. As mentioned in the Houston Chronical article Tax Benefits of Operating vs. Capital Lease, dependent upon which lease option you choose and the equipment you are leasing, you may realize tax advantages. Do your research and be aware of IRS policies.
Whether you decide to purchase your POS outright, or prefer to lease, take the time to research which POS provider offers the features that will help streamline your restaurant operations and increase profit today.
Posted on Mon, May 09, 2016 @ 07:05 AM.
Updated on May 18, 2020 @ 5:26 PM PST.
Posted by Tricia Hoy| Author's website