Monday, 21 May 2018

Looking for the Best Financing: The 5 Loan Options to Start Your Restaurant Business



Many people want to start and manage a restaurant business. Why not? Aside from it’s cool nowadays to have a restaurant, it’s also a promising business because it can provide you excellent profits. The fact that there are a lot of foodies looking for a restaurant that can serve them to satisfy their appetites is an excellent proof of that claim.

However, opening a restaurant business is not easy. Just looking for the financing alone can already give you a helluva of challenges. That’s why it will do you right if you’re familiar with the different loan options to fund your business. For a little help, here’s a list of the best loans for that purpose.

Working Capital Loans

This working capital is an excellent option for those newbie owners who want to get financing for their restaurant business. Restaurant owners typically use this loan to fund business expenses like the salary and wages of their employees. A working capital loan is also quick and no hassle to get.

However, a working capital loan only allows a borrower to spend it on short-term assets. You can’t use it to purchase long-term ones.

Equipment Loans

The cost of the equipment that you’ll purchase to run your restaurant business can be too costly, especially for a businessman who’s just starting. Take, for instance, the modern equipment that you’ll use for cooking such as industrial ovens. An industrial oven doesn’t come that cheap because it can cost hundreds of your money.

Thus, for you to ease a little bit of your budget, it will do you good if you apply for an equipment loan to pay for your equipment expenses. But, like the working capital loan, an equipment loan isn’t intended to purchase long-term assets.

SBA or Small Business Administration Loans

If you’re living in the US, there’s a government agency specially created for proprietors of small businesses who want to apply for a loan to open a business. This agency is called as SBA or Small Business Administration.

This US government agency offers different loans such as the 7(a) loan and the CDC/504 loan for you to start your small business.

The SBA 7(a) loan is a loan intended to assist those small business owners living in underprivileged areas. These small business owners can use the 7(a) loan for their working capital and furniture and equipment expenses.

The CDC/504 loan, on the other hand, is another excellent loan option if you want to establish a restaurant. This loan can cover your fixed, long-term assets such as the real estate property for your business.

Franchise Loans

Franchise loan is ideal for those folks who want to start a franchise restaurant business from a famous restaurant business chain. This type of loan offers those potential business owners with workable terms of credits and other financial opportunities.

The restaurant chain where you get a franchise will provide you with recommendations of various lenders for your business financing. Typically, these restaurant chains know big banks that will give you an excellent selection of loan offer to open your restaurant business.

Lines of Credit

Lines of credit is another of those loan options that will give you fewer hassles in applying for a small business financing. With your credible bank credit history, you can now ask for lines of credit.

However, there’s a catch to this type of business loan: it’s a little bit expensive. Lines of credit loan demand borrowers of paying their loans on a weekly basis. For you to get viable lines of credit loan, you need to have a strategic budget plan for it. You can get advice from experts at Ashe Morgan for that purpose.

Takeaway

It’s essential that you have a viable financing foundation to start your restaurant business. You can find various business loans nowadays for that purpose. However, you need to study these loans for you to get the best financing for your business. You can take some knowledge from the list of the best loan options above to open your dream restaurant.

No comments:

Post a Comment

Follow Us @soratemplates