The restaurant industry’s risky reputation stems from the countless ways in which a restaurant can fail. So much can go wrong at any time. Sometimes it’s your fault, sometimes it’s not. But regardless of who’s to blame, misfortune doesn’t always have to spell failure. As long as an otherwise thriving restaurant steers clear of just one mistake, it won’t have to make any drastic changes in the face of a financial crisis. That mistake is neglecting to look into restaurant business loans from alternative business financing companies like United Capital Source.
Unlike traditional business lenders, we don’t restrict our services to a minimal list of situations. In the restaurant business, there’s no such thing as an “ordinary” problem.
Why restaurants dismiss business loans
We understand why a restaurateur would be reluctant to contact a business lender. Restaurateurs are typically used to being cash-strapped, thanks to the industry’s notoriously low profit margins and absurd fixed expenses. They don’t panic when equipment breaks, staff members leave, or business gets unexpectedly slow for no reason at all. Their initial response might be to reduce expenses, even though this often ends up doing more harm than good. Very few restaurants bounce back after resorting to cutting staff, shutting down for lunch, or closing at an earlier time.
But it’s safe to say the number one reason restaurateurs avoid small business loans is because they are simply too busy. When a restaurant is first starting out, the boss literally helps out with everything. There’s no job he or she won’t do, including scrubbing toilets, busing tables or unclogging sewage traps.
We’re not like the business lenders you’re used to
Before companies like United Capital Source transformed the business lending industry, the application and repayment processes for restaurant business loans were extremely tedious and time-consuming. Borrowers had to compile significant paperwork, prepare detailed business plans, and remember to make fixed, monthly payments. No matter what kind of small business loan you were looking for, this was something you had to spend several weeks or months preparing for. Restaurateurs don’t have that kind of time.
Working with an alternative business lender is not at all like working with a traditional business lender. Very little documentation is required, and our business funding experts are happy to talk when it is most convenient for you. Yes, we are not the only business lender capable of approving and distributing funding in a matter of days. But most of these competitors offer just one product, or only approve borrowers that are in exceptional financial shape. United Capital Source, on the other hand, offers all sorts of working capital loans, credit card processing loans, revenue based business loans, and more. Our business funding programs can therefore solve a wider range of problems, both conventional and unconventional.
No problem is too big or small
Let’s say you buy ten thousand dollars worth of lobster when the market is low. But then your walk-in freezer breaks on a holiday weekend, when no one is available to fix it. You’ve already lost a lot of money, and without additional funding, you stand to lose a lot of business as well. But United Capital Source can let you keep operations going, especially if a great deal of your guests pay with debit or credit cards. A merchant cash advance requires small payments when business is slow, and even the best restaurants experience slow periods.
Many UCS clients use merchant cash advances and other working capital loans to stay current on expenses, which is very important for restaurants. Paying suppliers on time comes with numerous rewards, such as higher quality products, discounts, and credit extensions. And since most restaurants cannot afford to pay on time, you’ll gain a major advantage by developing an unparalleled relationship with your supplier.
Merchant cash advances, much like business lines of credit, can also be taken out on a cyclical basis. This makes them perfect solutions to regular refrigeration repairs, increases in staff, or massive seasonal expenses, like fish.
Putting the ball in your court
Anyone who has read a popular restaurateur’s autobiography knows that restaurateurs must be marvelous negotiators. Much of their success is attributed to their ability to ensure they never spent too much money or worked with the wrong suppliers. At United Capital Source, we live in the real world. We know that it’s nearly impossible to be a good negotiator when you are desperate for low prices. You can’t get a good deal when you aren’t in the position to be selective. This is why we typically structure our restaurant business loans to make sure there is sufficient cash on hand at all times.
Banks are in the lending business to a draw a profit as soon as possible. We are in the lending business to help you achieve long-term goals. If one of those goals is to only work with the best suppliers, then we will bring you closer to that goal as long as we remain partners in the coming years.