Best Retail Business Loans Explained
Now that you’ve seen which retail business loans are available, let’s analyze each one further. We’ll also explain why we feel each lender is appropriate for the indicated finance solution.
Small Business Administration (SBA) is beneficial if you are looking for a massive capital investment that you can pay off over more than a decade. Thanks to the government’s support, with these financial solutions you’ll pay less interest than you would with standard term loans. You can only apply for funding if you’re looking to make a profit, and not if you’re working for charity.
SBA loans are a good option when you’re looking to purchase or renovate a property and need an enormous capital injection. You can also include the cost of other fixed and movable assets you may need for your retail business, such as computer technology and security upgrades. Lenders are fond of offering retail companies startup capital thanks to the promise of a decent return on investment.
Funding Circle has a P2P lending model that works much like an SBA loan, but you’ll have a better chance of approval. Thanks to its innovative system, you’ll also be able to apply for other business loans when you need them. You’ll be given a dedicated account manager who will assist you along the way.
As the name implies, equipment financing lets you purchase the assets and equipment you will need to successfully run your business. Many companies prefer this financing solution, as you can receive approval for up to the entire equipment value. The only downfall is that the lender will reclaim the assets if you fail to pay.
Your retail business is going to need furniture, fittings, shelving, sales terminals, and a host of other equipment. Rather than take a term or SBA loan, you can aim for equipment financing, as it has a shorter repayment period. You can also use an equipment financing loan if you plan on leasing machinery for a year or two.
SmartBiz is an approved SBA lender that can help you obtain equipment financing through various solutions. SmartBiz will help you decide how much you need to loan to ensure that you won’t run short in the first few years. They also have a faster approval rate than banks and many other financial associations in the industry.
Inventory financing works much the same way as equipment loans but focuses on the initial stock that you will need. Inventory financing helps small businesses that can’t afford term loans, providing a short repayment period with low to medium interest. You will also receive up to the total value of the stock, based on a professional evaluation.
Since your retail business will need merchandise more than equipment, you may want to focus on inventory financing. You can stock up your shelves and storage rooms, to ensure that you can close sales in the first year. This will help keep that initial turnover and keep the ball rolling. You’ll need to ensure that you regularly replenish your inventory so that you can repay your loan on time.
BlueVine is our choice for inventory lines of credit. BlueVine's line of credit for inventory financing provides quick working capital for short-term borrowing requirements. With speedy approval times and multiple terms lengths for financing needs, BlueVine is a solid choice.
If you’re saving your capital and operating funds for employee wages and turnover, a business line of credit can help you deal with unexpected expenses. It works like revolving credit, giving you the chance to reuse the funds you repay. What’s more, you only need to pay interest on what you’ve used and not on the entire loan amount.
It’s dangerous to use the revenue you accumulate during the day on nonessential items. If you suddenly need funding to cover urgent costs, a business line of credit is a good backup to have. As a matter of fact, some retail stores now offer shoppers a line of credit, via lenders, as a means to repay them at the end of the month.
A specialist in short-term loans, OnDeck delivers an excellent business line of credit that will see you through hard times. You can use a business line of credit when in the initial stages of your business, as you don’t need a track record to qualify. It also offers you a higher loan limit if you’re a loyal customer.
A merchant cash advance is useful for businesses that accept debit and credit card payments. With this loan type the lender provides you with a lump sum, but you’ll need to repay a minimum amount weekly or monthly. The repayments are taken as percentages of the card sales made by your clients.
Shoppers are fond of using bank cards to make purchases in retail stores. It’s more convenient and safer than carrying around cash. If you want to take advantage of this, you can apply for a merchant cash advance and let your clients pay your loan off with every purchase they make.
Square Capital provides merchant cash advance for registered members, supplying them with card machines in their retail stores. If you aren’t a member, you’ll need to register first. This way, you’ll have a formal account with them, which you will be able to use to manage your income and expenses.
A short term loan is a good way to boost the cash flow of your company to help with a variety of expenses. This type of loan can be useful for a variety of businesses, such as construction, retailing or manufacturing.
If you are looking for a fast and easy access to finances, Fora Financial is recommended for all types of businesses. You can get approved for up to $500,000 in only 24 hours and the finances will be available 72 hours after approval.
You have up to 15 months to repay the loan which will save you a lot of interest compared to long term loans. You can get a no-obligation free quote from them and don’t need any collateral in order to qualify for a loan. There are also discounts for early paying off.