Get the Best Business Loan for Your Retail Store
A business owner in the retail space faces many challenges. A retail business has to effectively manage many factors such as seasonality of shoppers, price competition, inventory requirements, employee needs, process execution, and, most importantly, customer experience. To support these critical aspects, access to retail business funding options is indispensable.
Having a variety of retail store funding avenues at your disposal is paramount for a retail store to succeed and grow. Traditional lenders like banks might present hurdles, especially if you're operating a new business. Their requirements will be stringent and business financing options will be limited. In case mainstream bank loans are a bottleneck, retail entrepreneurs need practical alternatives to propel their establishments forward.
Fortunately, retail store funding businesses such as AdvancePoint Capital's lender network are here to help you sail through such financial needs. Through this convenient service, small retail business loans become more accessible, allowing you to enhance your bank account's health. Whether you're running a hair salon, a furniture store, or an e-commerce platform, finding the right funding solution empowers you to scale up your operations and thrive in a competitive market.
What is a Retail Business Loan?
Getting capital to help run the business is essential to fulfilling those needs. Having access to a retail business loan or other financing option to use for purchases or pay expenses on demand is essential for a retail store to succeed and grow.
Retail Store Business Loans: How it Works
Going to a bank, credit union or other lending institutions can be a challenge when trying to get bank loans for your retail business, let alone if your a new business. The criteria will be stringent and business financing options will be limited. A bank loan may not be in the cards, so what do you do next?
Many small business owners turn to AdvancePoint Capital's lender network to provide that small retail business loans or other retail store financing options so you can make your bank account grow.
Retail Business Loan Options
Small Business Loans for Retail Stores
Retail business loans are term loans with a fixed loan amounts, interest rates and payments. There are many uses for a retail loan including working capital, inventory, and business expansion to name a few. . Business term loans in particular, can be either short-term or long-term, subject to the retailer's needs and eligibility criteria, making them a versatile choice for many retail businesses.
- Terms from 6 to 36 months
- Rates starting at 13% APR
- Monthly or weekly payments
Business Line of Credit for Retail
Retail business owners use business lines to purchase inventory and wholesale purchasing power. Providing a business line of credit offers much-needed flexibility for retail business owners, enabling them to manage costs efficiently. With a business line of credit, you only pay interest on the outstanding balance, giving the retail store a chance to repay early as you sell inventory, thereby saving on interest costs. This financial product is particularly useful not just for inventory purchases but also for comprehensive inventory financing and managing payroll for retail businesses during peak seasons or sales dips.
- Revolving line of credit
- Ability to draw on demand
- Only pay interest on outstanding balance
- Rates starting at 1% per month simple interest
SBA (Small Business Administration) Loans for Retail Stores
Issued by an approved SBA lender, an SBA loan is a great retail business loan option, not only because they offer attractive loan terms with excellent interest rates and manageable monthly payments, but also for their potential as a real estate financing solution. Given that it can take up to 2-5 weeks to receive funds, timely application is crucial. SBA loans include, but are not limited to, the SBA 7(a) loan, which is a working capital loan that can help businesses expand. While this is not a short-term loan, SBA loan requirements include demonstrating creditworthiness, which involves a good credit history, a solid business credit profile, a strong business plan, and a personal guarantee. Securing an SBA 7(a) loan can be a challenge for qualified borrowers, but with its popularity and long-term benefits, it's certainly worth the effort. We’re here to help you navigate the complexities of the SBA loan process and optimize your chances of success.
- SBA loan rates starting at prime + 2.25%
- Terms from 5 to 10 years
- Monthly Payments
- Backed by the SBA
Merchant Cash Advance for Retail
Merchant cash advance is not a small business loan, but an advance based off of annual revenue of the business, repaid by the funder taking a fixed percentage of future credit card processing sales. Bad credit is considered for this product as well as reduced documentation for approval. This product is an alternative to traditional retail loans and inventory financing.
- Flexible repayment options attached to future sales
- Factor rates starting at 1.18%
- Estimated time to repay ranging from 3 to 18 months
- No set repayment time frame
Business Credit Cards for Retail Business
A good compliment to retail business loans are credit cards. Sometimes a retail business can be in a pinch and needs to make a quick purchase or pay for an expense. A small business owner can react quickly to these needs with a credit line like a credit card.
Equipment Financing
Equipment loans are a good tool when small businesses need to purchase large items like a point of sale system, or furniture or fixtures for their retail store, and seek equipment retail store financing to spread the expenditure over a longer period. Equipment financing, in the form of an equipment loan or lease, often comes with affordable interest rates to ease the financial burden on businesses.
- Loans or leases
- Terms from 2 to 5 years
- Equipment used as collateral
- Monthly and/or weekly payment options
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AdvancePoint Capital makes your retail loan application process a simple, straightforward experience.
SBA Loans For Retail Stores
Retail stores are uniquely positioned to benefit from SBA loans if looking to expand the business because of its favorable rates and terms not offered by traditional lenders or funders. The Small Business Administration offers a guarantee to SBA approved lenders to promote small business lending in circumstances the lenders would not ordinarily approved for such terms.
The SBA 7 (a) loan is the most popular loan program SBA has to offer. Below you will find details, purposes and benefits of acquiring an SBA loan.
Details
- Maximum Loan Amount $10,000,000
- SBA guarantees the loan to the SBA approved lender
- Terms from 5 to 10 years, with exception for real estate transactions which can go up to 25 years
- Rates starting at prime + 2.75%
Purposes
- Expansion or a renovation of a retail store or retail warehouse facility
- Funds new construction projects
- Can be used to purchase land and/or buildings as well as equipment
- General working capital need as long as the use can be documented
- Under certain circumstance can refinance and consolidate debt
- Funds can be used to start a business or acquire an existing retail store
Benefits
- Maturity of loans are greater than traditional financing
- Monthly payments that are affordable
- Rates and costs are lower than other business financing options
- Fixed terms with no early demand or balloon payment
How to Qualify and Apply for an SBA 7(a) Loan
You must contact an SBA approved lender to qualify for an SBA loan. The following are the basic qualifications needed t apply
- Your retail store must operate at a profit and cannot show losses
- Both business credit and personal credit of the business owner must be very good to excellent
- You must provide collateral in the form of equity like real estate
- Must be a U.S. Citizen
- Must show ability to repay with financial statements
Common Uses and Benefits of Financing for Retail Stores
Cash Flow
One of the great challenges of small retail businesses is balancing operating capital. Retail businesses have to balance inventory, execution of process, and the overall customer experience constantly. Most small businesses are highly competitive, and timing is essential to close sales. Having a business credit facility available is critical to meet those needs.
Marketing & Advertising
A cornerstone to most businesses is the ability to get the word out that their products are available for sale. Marketing online and offline is essential to success and vary from retail business to retail business, but make no mistake about it, if you don’t have a financing plan to support your marketing and advertising, your business will suffer. Businesses need advertising to maintain or grow their customer base.
Making Payroll
Retail employees are difficult to maintain as they are in high demand, tend to be part-time, and are typically not long term employees. If you don't make payroll you will lose employees quickly.
Hire Employees and Managing a Growing Team
There is little doubt that hiring and maintaining a great team to execute the sales process is the lifeblood of a retail business. Expanding a business may require an investment in salaries and signing bonuses that can really burden a business without business financing in place to sure up any short term cash flow issues.
Pros and Cons of Business Financing for Retail Stores
Pro's
- Financing provides access to to funds for purchases and pay expenses
- Provides access to capital for business expansion of a retail store
- A method to build business credit and can lead to future financing
Con's
- Financing adds debt to the balance sheet of a retail store
- Financing payments and to monthly expenses an can put stress on cash flow
- The risk of over extending the business which creates delinquency and or default impairing credit
Types of Retail Businesses We Serve
We serve a range of small to large retail businesses including:
| Brick and Motor Store | Merchandise Store | Clothing Store | Shoe/Footware Store |
| Sporting Goods Store | Womens Clothing Store | Men's Clothing Store | Furniture Store |
| Candy Store | Liquor Store | Convenience Stores | Dessert Shops |
| Auto Parts Stores | Harware Stores | Eyesglass Stores | Tattoo Parlor |
| Bridal Shops | Book Stores | Pet Shops | Home Goods Stores |
What Lenders offer Business Loans to Retail Stores?
There are a variety of business loan originators that offer business financing. The following are a list of the most commonly used financial institutions and originators
- Banks and Credit Unions- Banks and credit unions offer both business term loans, commercial real estate loans, business line of credit and in some cases SBA loans if the bank is an SBA approved lender.
- Business Loan Brokers- Business loan brokers also known as independent sales organizations represent a variety of products from business term loans, lines of credit, SBA loans, invoice financing, equipment financing, merchant cash advance, and other unique products.
- Online Business Lenders- These online financial institutions offer typically business loans and/or business lines of credit.
- Invoice Finance Companies- Invoice finance companies also know as Invoice factors specialize in purchasing invoices from retail stores.
- Equipment Financing Companies- Equipment financing companies offer business loans and/or leases when new or used equipment is purchased from dealers. The equipment itself is used as collateral to extend terms.
- Merchant Cash Advance Funders- Merchant cash advance funders offer the sale of future receivables from a retail store at a discount to the funder.
How to Apply for a Business Loan for your Retail Store
- Choose a loan advisor (business loan originator) - Select a lender or originator equipped with skilled loan advisors that best matches your qualifications with products, rates, and lender approval processes. Our dedicated team can make this initial step easier by handling all your paperwork, guiding you to suitable options that address your retail challenges, including options for equipment leasing if necessary.
- Complete Application Paperwork - During the application stage, you'll need to select products to apply for and fill out the necessary forms. Our retail loan advisors can assist with this by managing the documentation process, including gathering bank statements or financial statements based on the business funding product you choose, which might sometimes require loan collateral.
- Receive Offers - Tailored offers should be delivered by term sheet and/or specific State disclosures. Compare these with the help of advisors who can clarify the finer details like the repayment term, ensuring you consider all aspects of an offer beyond just the rates.
- Select an Offer - After careful consideration and comparison, and with the support of your advisors, notify the chosen lender (originator) of your selection. You will be asked to sign an agreement and provide closing condition documents for final lender approval, with minimal additional paperwork due to the efficiency of your chosen loan advisors.
- Receive Business Funds - Following a clear-to-fund notice, the repayment setup is completed by your advisors, ensuring a repayment term that aligns with your cash flow capabilities, and then the funds are transferred to your business bank account, allowing you to focus on your retail store's growth.
*The application process may vary depending on the lender and the products you choose to apply for. Remember that for options like SBA loans, the process involves significant paperwork and high credit standards, but the benefits can include borrowing up to 100% value of the equipment for your retail store. If your future plans involve equipment leasing, it's important to discuss terms that match your business strategy with your loan advisor.
Why AdvancePoint Capital?
- Experience – with Retail Industry. We have been funding many retail businesses for years, offering solutions like installment loans and business inventory financing which are designed to fit the unique needs of retail businesses.
- Trust – Excellent reviews and feedback from Retail Companies
- Loan Specialists –Experienced Business funding specialists who understand the nuances of retail financing needs, including robust options like term loans and SBA funding.
- No cost, no commitment quotes- We offer No obligation small business loans, with transparent terms and manageable installment payments that help you stay in control of your cash flow.
- Products – A Variety of Retail Store Business Loan Options from our online lenders network, such as inventory factoring, which can be pivotal for businesses looking to manage their inventory efficiently.
Start to Grow Your Retail Business Now!
Let's Get Your Retail Store Financing Today!
