Awesome Section 179 and Year End Spending Ideas for Restaurants


When we think of end of year spending we typically think of the hustle and bustle of the holidays and the multitude of trips to the mall to find the perfect gifts for the special people in our lives.

But there is another kind of spending this time of year; businesses making end of year purchases to max out their budgets or take advantage of Section 179 for tax season. At WAND we focus exclusively on the restaurant industry and there are generally two types of spending pushes we see restaurants make this time of year:

1. Those making one last end-of-year push. On the corporate side of things we see people making one last effort to spend the rest of their budgets. For those who manage a function that eats up a big part of their companies’ budget (such as marketing, technology or operations) they know they need to spend their full budget in order to get the same budget next year so it’s critical to spend the full amount. Also, these last few months of the year gives companies one final opportunity to make an end-of-year push to finish the sales year strong or start the New Year off on the right foot.

2. Those spending to take advantage of Section 179. On the franchise side of things, we see smaller franchisees and restaurant operators making purchases in order to take advantage of Section 179 of the IRS tax code that allows businesses to deduct up to $25,000 of qualifying equipment purchased or financed during the tax year. Some of the things included are; equipment (machines), business vehicles, computers and software. We see a lot of people this time of year making investments in restaurant technology they’ll use to increase sales in the next calendars year in order to receive the benefit of the tax deduction in 2015.

Need to burn through some cash and not sure where to spend it? We’ve come up with a few ideas to help you out.

Ideas for Corporate Restaurant Chains

  • Loyalty app, digital wallets and/or mobile ordering. 2015 seemed like the year of mobile. It was popular before but this was the year it seemed to boom across the industry. You may not have full development time you need to launch an app, digital wallet or mobile ordering for your brand by year-end, but you can make headway in choosing your development company and paying up front or making a nice down payment with your developer of choice. Need more info? Sign up for our webinar on Mobile and Contactless payments.
  • FDA caloric counts. In a little over a year all menus will be required to have calorie counts on them. If you already have your calorie counts in hand you can have your marketing agency of record or menu board partner (static and digital) get started redesigning your menus to add the calorie counts. Not only will you be able to pay for the cost of the redesign in 2015 but you’ll be ready to easily deploy them in early 2016 and get ahead of the game.
  • Menu redesign. Speaking of menus, many restaurant concepts are redesigning their menus to shorten the number of items, employ menu psychology tactics and feature more profitable menu items. The last few months of 2015 could be a good time to commission a menu strategy study or contract with a menu design consultant to figure out any menu redesign strategy you’ll be employing in 2016.
  • End of year promotion. Many of you probably have already planned for this, but if not, you should plan for year-end promotions to capitalize on the holiday shopping season. Customers will be flooding into mall food courts and retail stores and will most definitely be hungry after all that shopping. Decide on a strong, profitable promotion to run during those busy holiday months and be sure to promote it heavily in store as well as in your other marketing channels.
  • Social incentive. If you’re looking for a way to boost last-minute sales then offering an incentive through a social channel is one of the best ways to do it. Not only will you benefit from the sales you bring in for the short-term, but you’ll also get longer lasting engagement on your social channels. If you’re going this route one of the most effective things you can do is offer some sort of tangible item as a prize or free gift. Since people are out on the market searching for the perfect present already their ears and eyes will perk up when they see you offering some sort of gift they really want. You can offer it via a social contest or a social coupon type promotion. Just remember to make them do something (e.g. sign up for emails, Instagram us, follow us, etc.) in order for them to participate so they get what they want and you get what you want.


Ideas for Franchise Restaurant Operators

  • Office equipment. Office equipment such as computers, printers, back office software or manager workstations are some of the most common items restaurants purchase when taking advantage of Section 179 during the tax season. These are typically all higher ticket items but are needed to run the business so a good choice for this particular tax break.
  • Kitchen equipment. Closely following office equipment are actual kitchen equipment such as stoves, refrigerators and kitchen video systems for the restaurant. These last few months of the year are a great time to buy these because many suppliers are running end of year specials so you may already get big discounts. As you’re looking to purchase new equipment be sure to make sure you’re looking at energy efficient and sustainable models. Not only will you save money on energy efficiency, but sustainability is becoming increasingly important to consumers.
  • Digital menu boards. The last few years more and more companies are going digital with their menu boards, both inside their restaurant and outside in the drive-thru. Digital menus in the drive-thru particularly increased in popularity this year as technology became more cost effective and consumer demanded changed. Not only do digital menus help increase ticket sizes and operational efficiency but they also involve various technology components; screens, media players and software, all of which should be covered under Section 179.
  • Customized soda dispensers. Customers love to have things their own way so purchasing customizable soda dispensers is a no-brainer if you haven’t yet. It’s an easy way to attract and satisfy more customers in your restaurant.
  • Point of sale. In desperate need of a POS update? While you probably won’t be able to deploy an entirely new POS system by the end of the year you may be able to make a sizeable down payment on a new system or install new contactless payment technology to make your current system more modern. The hardware and software required for this should be covered by Section 179 and will not only help you run your business more efficiently but also prepare you to be EMV compliant.

Hopefully this list helps give you some ideas of where to spend up the rest of your budget. Please note that you should be sure to double check all the requirements of Section 179 prior to making any purchases to ensure your items are covered.

Happy shopping!

Looking for more ways to boost sales this holiday season? Register for our webinar.