Setting up a commercial kitchen is one of the most significant investments any food business will make. The costs of a commercial kitchen aren’t fixed numbers: they depend on:
- Your business model
- Equipment choices
- Site conditions
- Compliance requirements.
Whether you’re fitting out a compact café, a school canteen, or a large hotel kitchen, understanding the variables that drive commercial kitchen installation costs is critical for planning a realistic budget.
At Indigo Catering Equipment, we’ve designed and installed kitchens across restaurants, hotels, and schools. This guide brings together our expertise with industry benchmarks to give you a clear, practical picture of what you can expect to spend.
How Much Does It Cost to Build a Commercial Kitchen?
Opening a new food business is an exciting venture, but the financial undertaking of installing a commercial kitchen represents a significant investment. In the UK, a commercial kitchen fit-out can range from £11,000 to £400,000+, depending on the size and complexity of the project.
- Small kitchen: a food truck or a small café kitchen may cost between £30,000 and £50,000.
- Large kitchen: A large hotel or restaurant kitchen will often require £100,000 to £150,000 or more, particularly when multiple service zones, high-capacity equipment, and compliance systems are required.
- Ghost kitchen: A ghost kitchen, designed exclusively for delivery and takeout, often has a lower initial investment because it does not require a customer-facing dining area or the associated decor.
The first and most critical step in establishing a realistic budget is to precisely define the business goals and model and the location, as these factors determine the financial requirements of every subsequent decision.
What Factors Influence Commercial Kitchen Installation Costs?
Choosing Your Space: The Biggest Cost Decision
Where you put your business and what condition it’s in will likely be your biggest expense upfront. You have two main choices: rent or buy the space.
Rent vs. Buy
Buying land or a building costs much more at the start. You’ll need to put down about 10% of the total price. While you’ll own the property, this ties up a lot of your money. Renting is much cheaper to start – you usually just pay a security deposit and first month’s rent. But when you rent, you can’t make big changes without asking the landlord first.
New Building vs. Fixing Up an Old One
This choice isn’t just about money – it’s about risk too. Building from scratch costs the most and means you’ll need to hire an architect and get building permits.
Fixing up an existing building might seem cheaper, but it can lead to expensive surprises. You might find problems with the building’s structure, wiring, or plumbing that weren’t obvious at first. Issues like uneven ground, bad soil, or dangerous materials like asbestos can make the project take much longer and cost much more.
The Third Option
Taking over a space that was already a restaurant can save money because the kitchen equipment might already be there. But you still need to carefully check that everything works properly, or you might end up with expensive problems someone else left behind.
The Cost of Expertise
Hiring commercial kitchen professionals like designers, architects, and skilled contractors costs money upfront, but it can save you from much bigger problems later. It’s better to pay for expertise now than fix potentially expensive mistakes tomorrow.
Professional kitchen design and permit fees usually cost about 10% to 15% of your total budget. A good designer makes sure your kitchen layout works efficiently and follows all the regulations. This prevents problems like wasted kitchen space, slow service, and delays from health code issues.
One of the biggest mistakes when planning a commercial kitchen space is to be tempted to hire the cheapest contractor, but this often leads to extra costs, poor work, and permit problems – all things that can blow your budget. Quality professionals charge more because they do the job right the first time.
Typical Rates
Architects and designers usually charge £100 to £200 per hour or more. For skilled workers in the UK:
- Plumbers: £30 to £55 per hour
- Electricians: £35 to £60 per hour
Cooking Equipment Costs
Commercial-grade equipment often consumes the largest portion of the initial budget. Equipment typically accounts for 40–70% of the total installation cost.
This big difference in costs makes perfect sense when you think about different types of businesses. A small coffee shop might spend very little on equipment compared to everything else, while a busy restaurant with a complicated menu will need to spend most of its money on specialised, high-performance equipment.
- Ovens: £1,000–£15,000+
- Cooking ranges: £2,000–£15,000
- Refrigeration: £1,000–£8,000
- Ventilation systems: £2,000–£5,000+
How to Pay for Equipment: Three Main Options
You have three ways to get commercial kitchen equipment, each with different pros and cons:
Buying Outright
- Costs more money upfront, which can be hard for new businesses
- Saves money in the long run because you avoid monthly payments
- You own the equipment and can sell it later
- You have full control over maintenance and repairs
Leasing
- Requires much less money to start
- Frees up cash for other business needs like marketing or staff
- Lets you upgrade equipment easily
- Good for testing new concepts or temporary needs
- Costs more overall, and you never own the equipment
Financing
- Helps bridge the gap when you need equipment but don’t have all the cash
- In the UK: specialised catering equipment finance companies offer custom solutions
- Spreads costs over time to protect your cash flow
- Can be tailored to fit your budget
The best choice depends on your available cash, long-term plans, and whether you value ownership or flexibility more.
Compliance and Safety
Ventilation and fire suppression in commercial kitchens are mandatory and add significant cost. A ventilation hood system can run from £2,000 to £5,000, while fire suppression systems are often £2,000–£7,500. These systems are designed to protect against fire hazards, particularly those originating from high-risk cooking equipment like deep-fat fryers.
To learn more about health and safety and compliance, see our guide on UK commercial kitchen regulations.
Hidden Costs: Rules, Regulations and Contingency
Beyond equipment and construction, your kitchen budget needs to cover legal requirements and unexpected problems. Every commercial kitchen needs various licenses and permits to operate legally. If you are renovating or converting a building for commercial purposes, you would also require planning permission from your local authority.
Business and food service licenses can cost anywhere from $100 to over $1,000, depending on your location.
In the UK, you’ll need to follow strict rules about food safety, waste disposal, ventilation, and gas safety. Getting your kitchen to meet all building codes can add another £1,000 to £5,000 for inspections and required changes.
An important but often forgotten part of your budget is emergency money for unexpected problems. Things like contractor delays, surprise repairs, or hidden issues will happen – it’s not a matter of if, but when.
Planning for Ongoing Costs: What Happens After Opening
A good kitchen budget doesn’t stop at opening day. Many businesses make the expensive mistake of not planning for ongoing costs and maintenance that can seriously hurt profits over time.
Your biggest ongoing expenses will be electricity, gas, and water.
While utilities only make up 3% to 5% of total expenses, restaurants typically have very thin profit margins, so every penny counts. Old or inefficient equipment can secretly drain your budget, while newer Energy Star equipment can cut energy use by 10% to 50%.
This is why it’s important to make the right choices right from the start:
- Buy energy-efficient cooking equipment upfront: it pays for itself over time
- Install energy-efficient lighting
- Train your staff to watch energy usage
Final Thoughts
Building a commercial kitchen is ultimately about making smart choices that balance immediate costs with long-term success. While the upfront investment may seem daunting, viewing it as the foundation of your business rather than just an expense changes everything.
The money you spend on expert guidance, quality equipment, and proper planning today becomes the profit you earn tomorrow through efficient operations, lower maintenance costs, and fewer surprises.
If you’re planning to create a new commercial kitchen, a turnkey commercial kitchen solution might be a better and cheaper option, since it covers everything from start to finish (consultation, design, fit-out, catering equipment supply, etc…). This gives you one point of contact and ensures a smooth project from beginning to end while having expert support every step of the way.
If you’re ready to take the next step, get in touch for an initial consultation.
Commercial Kitchen Installation Costs FAQs
How Much Does It Cost to Make a Small Commercial Kitchen?
In the United Kingdom, a “small kitchen,” ideal for a cafe or food truck with a limited menu, is estimated to cost between £30,000 and £50,000. A more general fit-out for a smaller cafe can range from £11,000 to £400,000+, depending on the scope.
Why Is Kitchen Fitting So Expensive?
Commercial kitchens cost so much because everything about them is expensive and specialised. The equipment needs to handle heavy daily use, so it costs much more than regular appliances. You need skilled workers like electricians and plumbers to install everything properly, and they charge high rates. On top of that, commercial kitchens must follow strict safety rules, which means expensive ventilation systems, fire equipment, and other safety features that are required by law. All these costs add up quickly, making the initial investment very large.
How Long Does a Commercial Kitchen Last?
With proper maintenance, a commercial kitchen can last 10–15 years, although some equipment may need replacement sooner.
How much does it cost to fit a commercial kitchen?
A basic fit-out costs anywhere from £11,000 to £400,000+ for a large, complex build.
