Specializing In Small Business Loans For Liquor Stores

Each of the products listed above can suit a different type of expense or cash flow issue. For example, liquor stores experience a massive surge in demand during the holidays. However, discounts for bulk orders are usually available in the off-season, when sales are down. Liquor Store Business Loans can allow you to purchase large quantities of popular items during slower periods, especially those with high profit margins.

Since liquor stores tend to conduct high volumes of debit and credit card sales, a Merchant Cash Advance can be a sensible option for ordering bulk inventory. Your borrowing amount is directly based on monthly debit and credit card sales volume. When sales are slow, your payments are smaller. A Merchant Cash Advance is cheaper when payments are more spread out. Thus, you’d save money when sales drop again after the holidays.

Since demand is difficult to predict, you might find that an item is performing unexpectedly well. This is the ideal scenario for a Business Line of Credit, which is designed for moderately sized, short-term expenses. Your interest rate would be very low because it wouldn’t take long to generate the revenue to pay off your full balance. A Business Line of Credit can ultimately help you practice “last minute” inventory management, which means placing orders when you have a solid handle on demand. As long as you continuously pay back what you borrow, your credit line replenishes and can be used repeatedly.

Liquor Store Business Loans can solve an array of inventory-related challenges. To maximize profitability, liquor stores are often recommended to strive for a high inventory turnover ratio. This is only possible if you have the means to order the right amounts of the right items on a cyclical basis. But many stores might not have enough cash on-hand to order specific items at these intervals.

Liquor Store Business Loans allow you to maintain your inventory management system despite fluctuations in revenue and sudden expenses. In other words, your ordering capabilities wouldn’t be hampered by the need to update your security system, fix your refrigeration unit, or renew your licenses. The same concept applies to incorrect inventory forecasting. You can still capitalize on discounts for bulk orders or high-profit items, even though most of your working capital is sitting on your shelves.

Liquor Store Business Loans can also help you stay current on vendor payments, which makes you eligible for discounts or longer payment terms.

Taking on debt is always risky in highly competitive industries with unpredictable demand. You might order a new item only to discover that customers would instead purchase it from the grocery store in your shopping center. And it’s important to remember that ordering bulk inventory can do more harm than good if it sits on your shelves for too long. You can still struggle to pay your bills even after selling large quantities of low-profit items.

Significant expenses also tend to naturally create other expenses. For this reason, many businesses unknowingly end up borrowing too little. Let’s say you’ve just used a business loan to purchase additional inventory for the holidays. But this new inventory won’t do you any good if you don’t market it correctly with local advertising.

Lastly, Liquor Store Business Loans can be particularly risky for younger businesses. It can take several years for new liquor stores to understand the preferences of their average customer truly. Thus, it might not be wise to double-down on certain items when you haven’t quite figure out your niche just yet.