Food Franchise

Posts Tagged ‘Small Business’

A business cash advance or merchant cash advance might be the remedy your small business needs for an infusion of working capital. As the economy as weakened, many businesses have a need of a cash infusion and/or working capital to get them through these hard times. As banking has tightended its credit standards and less money is out there small businesses have to find alternative ways of obtaining credit. In the past, the increase in real estate prices and easy credit was a way many small businesses were obtaining capital. Due to the real estate downturn and problems in the banking community, this is no longer an alternative for the small business.

An alternative to this cash flow and/or working capital problem can be resolved in the business cash advance or the merchant cash advance area. This industry is based upon a different set of standards which we will describe below..

First of all, what is a cash merchant advance? .. An established business in existence for one year or more with visa and mastercard sales can qualfiy for a loan or a merchant cash advance on their past activity up to $150,000 from a financial institution and $750,000 or more per location from a true merchant cash advance company. The monthly average of their visa and mastercard sales x 1.5 will be a qualifying amount that the lender will fund up to. Here is an example for you, assuming your business averages monthly $50,000 for visa and mastercard sales over the last year. The financial institution will use that $50,000 x 1.5, therefore your lending base will be $75,000 for this example. Pretty neat, bet you didn’t know these programs were even out there.

For this advance program discussed today, this program allows you to obtain 1.25 x your monthly average of your master, visa, discover and american express cards. This program is buying a piece of your future cards based upon your past performance. The repayment amount is a fixed percentage of what you collect subsequently. Additionally, this program will advance up to $750,000.

Here is an example of this program, lets say your average monthly average credit cards sales average $100,000 per month and the advance company oks a advance of $125,000. They will apply a percentage to this amount say 15% and after funding, every credit sale you collect they will be paid 15%. If you have a great or a bad day, the percentage is always the same. This process will continue until the amount is paid off. Once you pay off 80% of the advance, you can apply for another advance. This program isn’t Fico driven which is a reason many companies can’t qualify at the bank today. This program doesn’t require additional collateral and personal guarantees. Usually, these cash advances are paid off in months not years.

This program doesn’t require personal income tax returns and other asset documentation…There are no application fees and/or this advance doesn’t effect your current working capital line at a financial institution if that applies..

One thing you should be aware of, this merchant cash advance company will require you to change your processor. They will also guarantee to beat the rates your are paying at the present time and offer other perks that they will assist you in any resistance you might have….

Another benefit to this program is that you can use these monies for whatever purpose you had in mind. Whether it is expansion capital, pay off old bills, debt consolidation, new equipment acquistions, buying new inventories, etc it is your decision..

The types of industries this business cash advance program covers is : Retail stores, restaurants, dry cleaning stores, tanning salons, grocery stores, bars and nightclubs, pet and grooming shops, flower shops, franchise restaurants, discos, pizza shops, automotive centers and shops, etc

The requirements to get this program going is for the applicant to fill out the cash advance application and fax the summary page of your last six months merchant statements to the merchant cash advance company.

The approval process takes as little as 24-48 hours and the funding within 7 business days

Happy hunting for your money….

It was a member of one of my business networking groups who told me this tale when we were discussing the impact of the recession on our individual businesses. This story is so relevant to today’s economic climate…….enjoy it.

There was once a barbecue restaurateur. But he was no ordinary purveyor of the humble rib for he used only the best spare ribs from only the finest, pigs in the land. The fries that accompanied his famous barbecue spare ribs were of equal quality, cut from the best potatoes available and fried in the most exclusive oil. He operated from small business premises not exactly on the restaurant strip and put out the advertising message on his frontage proudly stating that his barbecue spare ribs were the “best in the world, made with only the finest ingredients.”

As a result, his small business flourished and, in his own moderate way, he was financially successful. He had one son, his only child, and he wanted nothing but the best for him, so, using the money earned from his BBQ restaurant, he sent him away to university.

His son did well, enjoying being exposed to such clever people and weighty opinions, and it was some time before he returned home to his father during a holiday. He waxed lyrical about subjects previously of great mystery to the father, demonstrating his newly acquired knowledge with great panache and style, and his reputation grew.

One evening, shortly before his return to university, the son took the father aside to discuss the family business. “Father”, he said, “there is talk of a great recession that is going to take place in the world, with even large corporations fighting for their very survival so think how this will affect a small business. Times will be hard and the only way to stay afloat is to cut costs drastically”. His father listened attentively as his son added, “everywhere I look, in the papers, the radio and in the halls and coffee bars of my university, the message is ‘cut cut, cut’. I urge you not to fall behind the trend. My advice to you is to cut costs to survive this recession”.

The father was by now in awe of his learned son, and he could not ignore advice from him, which was so well supported by the media and the discussions that take place within a recognised seat of learning. He drastically cut his orders of pork ribs and potatoes, chose a cheaper, more common frying oil, did the same with the wood chips for the BBQ smoker and changed the advertising message on his diner to reflect that he no longer used the finest ingredients.

Within only a few months, his business could no longer support him and his family, and he sold it to a BBQ restaurant franchise at a great loss and was forced to take early retirement. He called his son to tell him of the sad news, telling him he must stay at university, as his son had become so clever that he had foretold the difficulties the recession would bring. His final words to the educated offspring were: “what a wonderful thing a university education is.”

And the moral of this story?

Don’t believe all that you read and take control of your own destiny.