In order to keep up with and surpass competition, a store must do more than properly stocking inventory, offering competitive prices and providing outstanding customer service. They also need to keep up with the latest technology. Funding mechanisms may be needed for new, more efficient equipment and performing necessary renovations to keep the store looking fresh and eye-catching.
Investing in cutting-edge technology is imperative when looking to perform upgrades and renovations. By using high-tech systems, a store will have a lasting presence, without the costly need to perform these tasks again rather quickly. Stores that don’t renovate when necessary, risk losing customers to cleaner, less stale-looking establishments that will garner a reputation as being current with the times.
“For many owners of independently owned, small to mid-sized businesses, equipment upgrades and renovations are easier said than done,” said Elie Katz, president and CEO of National Retail Solutions. “They can be especially challenging to the vast array of independent merchants operating on a very tight budget. Merchants must ensure that they painstakingly account for every line item and their rainy day fund so that they don’t overextend capital and liquid assets. But there is good news. Proprietors can tap into ways to upgrade failing equipment and renovate without breaking the bank.”
Common sources of funding for a business may include dipping into savings, using credit cards, seeking our government programs, crowdfunding or approaching investors. When a business is short on money, the owner may think of borrowing from friends and family, but this can create tension if the loan isn’t repaid on time. Another seemingly obvious method, obtaining a bank loan, can be a very difficult process, especially for a new business. Covid-19 PPP assistance programs have required so much confusing paperwork and documentation, that small, independent store owners were practically deterred from applying.
One obstacle a Mom ’n’ Pop shop owner may encounter in securing a bank loan or PPP loan is the stringent and agonizingly slow bank loan approval process. Even if successful in obtaining a loan, merchants will likely face high interest rates and repayment thresholds plus other fees and payments hidden in the loan agreement’s fine print.
“A much more flexible and efficient option is obtaining a cash advance. Companies, including first-rate POS providers, provide cash advances, which are significantly easier to attain than arduous bank loans.,” Katz said. “The cash advance application process is much more clear, user-friendly and effective. In addition, income thresholds for cash advances are usually lower than bank loans. Additionally, cash advances put funding in store owners’ hands significantly faster than the time required to process a bank loan.”
Cash advance providers are often more attentive and tailored to store owners’ needs. Some offer customer service representatives that are fluent in several languages, which can be extremely helpful for ethnic retailers. In addition, cash advances are more adaptable than bank loans. Classic bank business loans are paid off with unbending terms over a predetermined time period. Cash advances can be paid back based upon and through credit card sales, and can vary from month to month, greatly reducing the stress associated with large, unexpected payments.
For almost any source of funding, a wise retailer will have created a business plan and budget. By leveraging data off the store’s point of sale (POS) system, a store owner can identify trends and see sales patterns, which will invariably be helpful when seeking to obtain a loan based off receivables. The more documentation a store owner can show for the value of their goods and services, the better interest rates and repayment terms they will get.
“Obtaining capital for upgrading equipment and updating a location should not be stressful,” Katz said. “Funding can be a positive experience that helps build up the business and leads to increased revenue generation.”