Applying for financial help is advantageous for any business, no matter the size. Whether you’re just starting out on your new venture, or you’re an established business that needs a boost to grow, there are so many loans to choose from, like small business loans, inventory loans or a merchant cash advance. Read on to find out more about the finance options you could choose for your restaurant business.
How can finance help your business?
When you run your own business, there may come a time when you need help financially to kickstart your venture, or to keep you afloat in hard times. There are a few different types of finance options that you can choose from, that offer various benefits such as:
- Improves cash flow: Depending on the type of finance that you choose, you can improve your cash flow when money is tight. Loans and cash advances mean that you will have more money to work with to make your business a success.
- Gets your business off the ground: If you are a new business, and you’re just getting started, you may need additional funds to get you off the ground. A start-up loan or a business loan can help you with the funds you need to invest in your company.
- Boosts sales: You can use finance options to diversify or grow your business to boost sales and increase overall profit and revenue.
- Improve products and service: You can use one of the many finance options available to improve what you are offering to your customers, as a way of investing back into your company to make a profit and improve your reputation within your sector.
Whilst almost any business can benefit from using finance to its advantage, we’re going to take a look at how restaurants in particular can give themselves a boost with a range of finance options available to them – some of which include:
These loans are perfect for restaurants that are not part of a franchise and are classed as small businesses. To be approved for one of these loans, you’ll have to do a bit of research on which lender offers the best interest and repayment period for you. You will make monthly repayments if you are approved for one of these loans, and you can use it for anything you like! To hire more staff, to grow, for supplies or to make general improvements to your business.
This type of financing is different from a traditional loan – it helps businesses to buy inventory and products that they need so that they can sell them to make a profit. The materials that you choose to purchase should be products that you expect to sell in the future. Various lenders can offer you this type of loan – you just have to find the most appropriate terms for you, and make sure that your credit score and history are up to scratch before you apply – this might end up with lower interest rates and a better chance of being approved.
Merchant cash advances
If you take card payments, you can use a merchant cash advance to acquire funds now and use the profits that you make to pay back your lender. This doesn’t technically count as a loan, but you should make sure that you can afford to pay back 5-20% of your profits to pay for your advance. Like a loan, you can use this finance for anything you need to improve your business, whether that’s buying stock, training staff, or making improvements.
What if you have bad credit?
If you have bad credit, you may be wondering whether you will ever be able to give your restaurant a boost with financial help. Well, you can! Restaurant loans for those with bad credit are available. Lenders know that the industry is difficult and are willing to adjust interest rates and repayment terms to suit those of us that may find it harder to pay back a loan. You should always make sure that you can afford the repayments when you decide to take out a loan to help your business so that you can avoid sinking further into financial difficulty.