Which industries receive the most benefit from merchant cash advances?

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Written by Michael Foote , founder of Quote Goat, with over 13 years experience working in the finance, insurance and currency sectors.
13/05/2020

Small business owners are often left frustrated when attempting to secure capital for their company in the form of a business loan. Often they are turned away, especially by the larger lenders who offer traditional bank loans due to their demands, expectations of assets and lack of trust in small businesses.

Owners of small businesses know that in order to grow their business, hard work isn’t enough. They also have to have the money to invest in more equipment, to grow their team and source more materials in order to boost their output, increase productivity and raise those profit margins. We want these small business owners to know that there are alternatives out there that they can turn to.

While there are more well-known alternatives such as invoice finance, one lesser-known option is a merchant cash advance, which can be a hugely beneficial alternative to a small bank loan for a number of different industries, including:

Retail

The retail industry rarely sees a steady income all year round, instead they notice fluctuations that can see their sales dip at certain times of the year. Being able to rely on added finances during these times is important in securing wages for staff and ensuring a retail store remains operational.

Merchant cash advances work well for retail companies as they see a large number of transactions carried out via credit card. With merchant funding stores are able to invest in inventory that can help them make more sales or hire new team members during busier periods.

Salons

Another small business that receives the large majority of its income via credit card transactions and relies heavily on their inventory and productivity of their limited workforce. If salons are expected to remain competitive they need to be able to ensure they don’t have to turn customers away. To do this, they need have a team that is ready and able to cover any request directed at them. To do this they may need to invest in new personnel or training for their current employees.

Hotels

Hotels of all sizes accept the majority of their payments through credit card transactions. They are also another industry which can see huge fluctuations in income depending on the item of the year. The hospitality industry is heavily dependent on the seasons and a hotels summer income will look much different to their winter takings.

Hotels do have the benefit of receiving booking payments via credit card throughout their off season, which can help them secure merchant cash advances in order to invest in and expand their business when they are not as busy.

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