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For many years, the largest competitors for small retail businesses were “big-box” retailers, or national chains offering wide selections for competitive prices. Examples include department stores like Macy’s, Sears and JCPenney as well as discount stores like Kmart. The dominance of these stores is currently being threatened by the rise of ecommerce businesses like Amazon and Etsy. Sears and Kmart revealed in June that they were closing 20 locations, not long after other big-box retailers were forced to close several hundred more.

According to retail think tank Fung Global Retail & Technology, the string of closures will strip big box retailers of about $2.5 million in sales. It’s easy to assume that ecommerce would steal all of this revenue but with the help of small business funding, small businesses can reap a sizable portion as well.

How Did Some Survive?

Not all department stores and discount stores have suffered significant losses at the hands of ecommerce. Target and Walmart are still going strong because unlike the four aforementioned examples, these two chains quickly adapted to today’s digital landscape. They conduct a great deal of sales online and invest heavily in digital marketing. The fastest-growing small retailers in 2017 have interactive, easily navigable apps or websites that push new offers and allow customers to enroll in loyalty programs without having to fill out paperwork or wait on line. Email blasts are sent on a regular basis, and their Google ads only show up following relevant search queries.

If your sales have plateaued, it’s likely because you haven’t invested in digital marketing. United Capital Source can level the playing field with our working capital loans which are geared towards long-term campaigns. Digital marketing teams have different payment plans but we could customize your funding program to ensure that you can run your business smoothly while making payments that don’t kill your cash flow. Our programs can collect less money based on sales volume from borrowers as marketing campaigns work their magic since it’s usually best to start such initiatives during the slow season, when you are deciding what to promote for the busy season.

Also Up For Grabs…

The closure of big box stores also leaves many of their suppliers looking for new accounts. Larger accounts, however, are notorious for late payments, sometimes making smaller businesses wait up to 120 days to be paid in full. But these suppliers will not just change their payment terms for the first company that approaches them. They will look to see which company lets them keep their long payment periods with no intention to change anytime soon.

United Capital Source has helped several small retailers land big accounts with accounts receivable factoring, which gives you the ability to keep major clients while covering regular business expenses as well as take advantage of crucial investments like excessive inventory or renovations. With this business funding program, UCS buys a certain amount of accounts receivables in exchange for a percentage of the revenue you receive when the supplier pays you. Funding can be distributed as a single lump sum or on a monthly basis. You would essentially get paid up front and lose just a small portion of income, which is nowhere near as detrimental to your profit margin as letting these accounts go unpaid.

Now that money will be coming to you on schedule, you can court other potential customers by offering them convenient terms. Having money to pay your suppliers up front or faster than your competitors also makes them likely to give you a discount, especially on bulk orders. You’ll be shocked to learn how many more opportunities for partnerships will come your way when payment terms or seasonal dips in revenue are no longer a restriction.

Yes, You Can Have It All

You can’t advertise if you don’t have the inventory to satisfy demand. The primary purpose of accounts receivable factoring is to secure the best inventory as quickly as possible, whereas long term business loans are a highly appropriate business funding program for long-term investments that take time to pay off. Accounts receivable factoring does not show up as “debt” on a balance sheet, which makes you look more eligible for credit card factoring, as long as your customers pay their bills. At United Capital Source, our goal is to open up as many options as we can for expansion. Taking out multiple rounds of funding seems complicated but our clients will assure you that it couldn’t be any easier. Whether you’re interested in both programs or just one, we will position you to immediately capitalize on your next chance to gain more customers and give them the products they want!


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