Enjoying ‘spirits’ is a popular past-time, and it’s good business too. In the United States alone, there are nearly 43 thousand liquor stores generating $45.5 trillion dollars in annual sales, based on 2016 data from Statistic Brain. Many of these liquor stores are privately owned and operated by small business owners. In some communities, larger wholesale liquor and wine retailers have moved in, making the market highly competitive.
THE CHALLENGING BUSINESS OF RUNNING A LIQUOR STORE
Typically, liquor stores have a large number of cash and credit card sales, meaning this can be an ideal way to obtain working capital by taking merchant cash advances. Liquor stores require a steady cash flow because inventory must be turned around quickly to earn a profit, and fresh products must be brought in on a regular basis to maintain quality. Small business loans can be a good way to manage these expenses.
There are many licensing and health code requirements to operate a successful liquor store. In some states, there are limited numbers of full liquor licenses available, costing as much as several hundred thousands of dollars to obtain. Most liquor stores also require more sophisticated security systems because they are frequent targets of robberies and other crime. It’s not an easy business, but it can be highly rewarding and profitable.
ADVANTAGES OF LIQUOR STORE MERCHANT CASH ADVANCES
With these factors at play, merchant cash advances can be beneficial for liquor store owners who need a steady source of income. If you are operating a liquor store and need extra funds, here are the reasons why cash advances on merchant payments can work well for you.
NO HASSLE, EASY ACCEPTANCE
Unlike traditional small business loans, merchant cash advances don’t come with all the massive amounts of paperwork to fill out, financial reports to share, and the worry over credit scores. Merchant cash advances are determined by how long you’ve been in business and the amount of credit card payments your liquor store accepts on a monthly basis. And you don’t have to worry about putting up any collateral either.
ACCESS TO FAST CASH
Because the process to get approved for a merchant cash advance is so quick, money can be in your pocket a lot faster than through other means. If you are facing an unexpected expense or trying to pay down other small business loans and credit cards, this can be very helpful. Future merchant cash advances will be easy to get too as a pre-approved small business.
FLEXIBLE REPAYMENT TERMS
It can be worrisome to borrow money for any small business, especially with a liquor store which may experience peaks in buying seasons and slow periods in between. The good news is that merchant cash advance payments are determined on a small percentage assessed on every credit and debit transaction you take, so the money goes out in small increments you will barely miss. If you fall behind, your lender can work with you to get caught up with more flexible terms than any bank will ever offer.
HIGH RATE OF APPROVAL
Along with a fast application process, the approval rate is a lot higher than with small business loans. This is because a lender like United Capital Source is evaluating the merit of your liquor store based on actual business performance. Therefore, if your business is stable, there should be no reason why you wouldn’t get approved. Banks tend to see liquor stores as risky so they may not be as willing to approve your business for any loans. Keep in mind that merchant cash advance amounts may be based on average revenues for the past 6 to 12 months.
GOOD OPTION FOR BAD CREDIT
If your liquor store has struggled with poor or bad business credit, but you have a steady flow of sales for your liquor store, a merchant cash advance can be the right solution for you. You will need to have a merchant credit card vendor already set up to accept payments, for the best results. Over time, as payments are made on time or early, a merchant cash advance can also help to improve your credit rating.
MORE REGULATED LENDERS
A few years ago, there were few companies that were regulated by financial laws to provide merchant cash advances. Today, however, financial organizations like ours must prove that we are connecting small business owners with reputable merchant credit advance programs that conduct fair and reasonable business practices. So, there’s no guesswork or wondering if you are getting a good deal.
LOW INDUSTRY FEES
As compared to other types of small business loans and credit card programs, merchant cash advances offer very competitive industry rates. A very small fee is assessed with each payment, and this cost can be deducted as part of business expenses. Your liquor store can stay in business and you don’t have to raise your costs in order to afford a cash advance on your merchant account.
WORKS WITH MOST MERCHANT VENDORS
Whether you are using a major merchant vendor or have chosen to work with a small, less-known company, there’s no need to be concerned. United Capital Source has multiple relationships with merchant credit card vendors and their partners, to make sure any business has access to these benefits. You won’t have to switch to another vendor you don’t want to work with.
A BUSINESS PARTNER FOR LIFE
Getting a merchant cash advance for your liquor store means you have a partnership with your business for as long as you wish. You will be able to borrow more money in the future to expand operations, refresh your inventory with a new product line, hire more employees, and market your business. This gives you an edge on the competition and elevates you above the mom and pop liquor store status.
While this is not an exhaustive list of the benefits of a merchant cash advance, this should give you an idea of what you can expect when you connect with the caring financial reps at United Capital Source. It can’t hurt to find out about a merchant cash advance or some of the other alternative small business loans available to your store.