Investing in a coffee machine may be necessary to upgrade the coffee production of your café, improve the guest experience in your hotel, or simply cater to the coffee cravings of your office employees.

Choosing which type of coffee machine is best suited for your business or workplace is only the first step in the process.  The next step is deciding if you want to rent, lease or buy the coffee machine outright.

All three options come with advantages and disadvantages to make yourself aware of. Read on as we discuss the pros and cons of each option, to ensure that you are making an informed decision on the types of purchase methods.

Renting option

Renting a coffee machine means that is loaned to you for a predefined period of time, but ownership of the machine remains with the company you have your rental agreement with. Usually, installation, maintenance and servicing come as part of the agreement, and there is an option to extend the agreement once the predefined period of time has finished. In addition, signing on to a rental agreement includes a training programme to guarantee the proper operation of the machine by the users.

An advantage of renting a coffee machine includes more flexibility, as you can rent a particular model for a short period of time and assess whether it works well for the demand, or whether another model is more suitable. Another advantage is the cost-saving component of having a renting agreement, as the total cost of the coffee machine is spread out into manageable month by month payments.

The main disadvantage would be 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 the provider. Another disadvantage of renting a coffee a machine can be that 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 option

Leasing a coffee machine is very similar to renting; as you agree to a specific time period and do not have ownership of the machine, but use it as it were yours. The main difference leasing has to renting would be at the end of your leasing agreement, you have the option to take ownership of the machine, upgrade it, or return it.

A major advantage of leasing a coffee machine is the efficiency of the lease agreement. For example, the transition to upgrade or purchase the coffee machine at the end of the predefined leasing period becomes easier. The leasing option also has 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 organisation.

Similarly to renting, a disadvantage of having a leasing agreement may be 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.

Purchasing option

Purchasing a coffee machine means you pay for the machine in one lump sum, and you have complete ownership of the machine. The purchasing option works by making a one-off payment for the coffee machine and then setting up, and waiting for the installation date.

The advantages of buying your coffee machine outright include being in complete control of what machine 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.

Although there is typically a 1-year guarantee with any newly purchased machine, maintenance and servicing is not part of the overall payment – unlike in a rental and lease options. Should your new machine breakdown or have any faults, after the guarantee period, you may potentially have to pay to get it fixed and for any required consistent maintenance.

So, should you rent, lease or buy your coffee machine? As we have discussed, all three options have their benefits and constraints, and making this decision is based entirely 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 have started with renting the machine, and once their business has grown, they have opted to extend their contract. Many prefer leasing as they want to continuously upgrade their machine without being tied down to a specific model. And some want the feeling of ownership with the machine and prefer to buy it outright.