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Key Investments For Restaurant Business Loans

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By Jared Weitz Posted Wednesday 04, 2017 In Small Business Tips, Small Business Loans

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Standing out is easier said than done in the restaurant industry. Everyone wants to provide the same things: great food and service in a comforting environment. Your most successful competitors got where they are by finding ways to accomplish these three things more effectively than anyone else. On the surface, they don’t appear to be doing anything radically different than the average, well-intentioned establishment but it turns out that seemingly minute differences are what separates the average from the above average.

A look at the bills of today’s top restaurants will show you that “little” differences come with a large cost. Restaurant business loans via alternative business financing companies were designed to put you on the path to standing out and showcasing what you can do with the most powerful tools of the trade.

The Taste Of Home

Anyone who works in a big city knows that the most popular lunch spots are fast-casual restaurants that sell everything from Mexican classics to freshly-made bowls. There’s a ton of places to get burritos and salads in the area but many people choose fast-casual options because of their commitment to organic ingredients. The meat and produce comes from local farmers or distributors, which is most certainly something to brag about because it is incredibly expensive.

Another obstacle in using local ingredients is the lack of constant availability. This is a fairly new strategy, so farmers and distributors haven’t had time to learn how to keep up with the demands of their buyers. Organic restaurants must therefore buy in bulk, well before the need for the ingredients actually arises.

Farms Are Your Friend

United Capital Source offers restaurant business loans tailored for these exact two situations, which stem from the inevitable dips in cash flow experienced by restaurants throughout the year. Whether it’s due to seasonality or the need to remodel/renovate, even restaurants with lines out the door become tight on cash during certain periods. They can’t simply adjust their financial cycle to meet their suppliers’ needs.

But with our working capital loans or highly competitive credit card processing loans, smaller restaurants gain the ability to make important purchases at the right time and develop good relationships with suppliers. Creating a budget that accounts for the needs of your suppliers will result in discounts on bulk purchases and help your suppliers grow as well, making them more reliable and punctual.

Speed Kills

Fast-casual restaurants are constantly trying to one-up each other in regards to speed. Business more than doubles during the busy season, so they increase the amount of employees actively serving customers. At Dos Toros, the counter is built at a right-angle to allow for two assembly stations, as opposed to a straight line with just one assembly station. Each restaurant has two perpendicular service lines, which essentially doubles the amount of customers who can be served simultaneously.

Doubling your service staff wouldn’t be such an issue if they didn’t require extensive training and an array of vital skills, like being able to walk new customers through the menu. You’ve got to begin getting these new hires ready several months before their first day, and it’s not as if the increase in customers occurs the moment your payroll doubles.

This common dilemma prompted United Capital Source to develop restaurant business loans in which smaller payments are accepted when new hires are being interviewed or trained. Merchant cash advances are ideal for these cases because restaurants conduct a great deal of sales via credit card and your amount is based on how many sales you are projected to make, which hopefully will be higher with more workers at your disposal.

When One Investment Is Really Two

A major advantage of United Capital Source’s restaurant business loans is the ability to coordinate investments that go hand-in-hand. For example, if you are about to complete renovations, you need advertise your new look with promotions. When Dos Toros opened one of its locations in New York City, free burritos were given out at certain times throughout the week. Their team of workers was fully-trained, and they had more than enough supplies to handle the massive influx of customers. Many UCS clients take out small business loans so they can have multiple efforts completed at the same time. This ultimately maximizes the likelihood of each investment working out correctly.

Since it’s so common for restaurants as well as other industries to be tasked with multiple investments or initiatives at once, we offer additional rounds of funding for clients who can successfully pay off debt, even if the first round was just a short-term working capital loan. United Capital Source can help you plan your budget for the entire upcoming season, and design a funding program that positions you for another business loan after your initial debt has been paid back in full. We are your loyal partners for the rest of your career, so you can always be 100% sure of every financial decision you make! 

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