From an outsider’s point of view, starting a small business seems completely pointless. Most industries are ruled by national chains armed with massive selections, low prices and an advertising budget that makes them the most popular names in the game for anyone with a TV. How in the world are local businesses supposed to build a solid customer base with so much stacked against them?
The easy answer is to create unique, high-quality products or services but as any small business owner can attest, impressive quality must be accompanied by impressive prices and impressive reliability. Tremendous success is entirely feasible for small businesses as long as they have a constant supply of whatever is needed to fulfill all three of these characteristics.
This is why, for many successful businesses, the key to competing with big chains is the ability to purchase massive amounts of inventory or equipment at any given moment. Here are four types of small businesses that accomplish this via small business loans from alternative financing companies like United Capital Source.
Smaller boutique cosmetic stores are faced with a variety of intimidating competitors. There’s major department stores like Macy’s, cosmetic chains like Sephora, and online retailers like Amazon. Putting even more pressure on this industry are YouTube tutorials showing how specific make-up brands and items can produce a certain look. These videos have proven to have a powerful influence on the spending decisions of younger shoppers, who will then give their business to whatever store is carrying the products featured in their favorite videos. Establishing a reputation as the go-to source for the latest crazes is therefore crucial for any small cosmetic store looking to stay competitive on a regular basis.
Applicants for bank loans must wait months to learn whether or not they’ve been approved and even longer to receive funding but alternative business financing companies like United Capital Source are able to grant approval in 24-48 hours and distribute funding in a matter of days. Cosmetic clients of such companies can quickly stock their shelves with a new product as soon as they see it being advertised in addition to any similar products that might catch on. Shoppers are always looking for something new, so cosmetic stores must constantly expand their inventory to satisfy any and all changes in demand.
Seasonality is a major factor for the many retail stores that conduct the majority of their sales during certain times of the year. The busy season follows the slow season, when sales are down and covering expenses like bills and payroll becomes a struggle. But in order to capitalize on the busy season, a series of investments must be made during the slow season. Chief among these investments is inventory, which is often available for discount prices if it is purchased several months before business starts to pick up. But because of the slow season, smaller retail businesses either have little capital available after purchasing excessive inventory or cannot afford the inventory they need if they wish to keep their business running smoothly.
This is where alternative business financing comes into play. United Capital Source specializes in business funding programs crafted specifically for this situation, when the fixed, monthly payments of a traditional loan would severely impact cash flow. You could have a payment structure in which smaller payments are made when business is slow or choose a Merchant Cash Advance, which supplies a lump sum of capital today in exchange for a percentage of future credit card sales. With this type of working capital loan, you would be able to purchase inventory and pay more of the principal back when sales pick up.
It’s extremely disappointing to visit a car dealership, find the car you want and then learn it won’t be available for several months. Preventing this means always ordering plenty of inventory from manufacturers and allowing customers to trade-in used cars. Certain vehicles can be purchased from manufacturers at discount prices during specific times of the year, which is why dealerships offer discounts on days like President’s Day and New Years’. But when inventory is purchased, either through a manufacturer or customer, the dealership doesn’t turn a profit until the car is sold.
This can create cash flow shortages so severe that paying dealership fees and other regular expenses seems like an impossibility. United Capital Source solves this dilemma by providing short-term business funding, typically during periods rife with trade-ins. Dealerships must continuously purchase inventory, even when sales are down, in order to offer competitive prices. Alternative funding programs can help them survive cyclical dips in revenue or take advantage of opportunities to stock up on popular vehicles.
A small business cannot thrive in the restaurant industry without a specialty, or a niche. The failure and success of certain restaurants has proven that it’s not an eclectic array of choices but a centralized menu that produces a solid following. You’ve got to show customers that you can prepare a highly specific type of cuisine better than anyone else. This requires you to consistently order large quantities of a relatively small number of ingredients all throughout the year. But the cost of vital ingredients is always subject to change, and it’s difficult to cover these expenses when business slows down during certain times of the year.
When these situations arise, alternative business financing companies can ensure that not a single day goes by without the proper ingredients in stock. Restaurants conduct a great deal of sales via credit card, making them perfect candidates for a Restaurant Cash Advance. The capital could allow them to order all the necessary ingredients while remodeling their location or taking on new hires.
Ordering Inventory The Right Way
If banks understood the importance of keeping inventory, they wouldn’t make you fill out several days’ worth of paperwork and assign generic terms that completely ignore the urgency of your investment. At United Capital Source, however, we always aim to provide business funding in a timely-manner, and our one-page application takes just a few minutes to fill out. Good payment history will make your business eligible for additional funding that you can take out at the same time next year, when you are ready to expand your business once again!