Unfortunately, some businesses may not qualify for traditional business finance, particularly due to their size or youth. This is where a merchant cash advance (MCA) can come in handy. It allows businesses to receive the capital they need quickly. With a merchant cash advance, you receive your required amount as a lump sum. You must then repay with a percentage of your business’s future credit card sales.
Because of this, industries that accept credit card payments frequently are more suited to this type of alternative business finance. Learn about these specific industries below to determine if an MCA may be right for you.
Restaurants
Restaurants can have substantial fluctuations in cash flow, especially when it comes to holidays, major events, and even tourism. To offset these cash flow problems, restaurant owners might run advertising campaigns, lay off employees, expand to delivery or catering, and strictly manage their inventory. These activities aren’t always enough to compensate for a lack of cash flow, however, which is where a merchant cash advance may be required.
Since most restaurants accept credit card payments, merchant cash advance loans are ideal for the industry. Their repayments also correspond to the speed of a restaurant’s sales, ensuring they don’t have to repay an amount they cannot afford.
Retail Stores
Retail establishments can also face unpredictable business patterns. If you run a retail store that periodically experiences a sales downturn, having additional funds on hand can help you keep your business afloat. Therefore, a merchant cash advance might be a suitable choice, especially since many customers pay with their credit cards.
A retail store might use an MCA to invest in the inventory that’s most popular with its customers, as well as to cover overhead costs or hire additional staff. This is particularly useful during busy periods, such as the holiday season.
Salons
Salons are another type of business that are particularly well-suited to merchant cash advance loans, especially since a lot of their clientele pay using credit card, as opposed to cash or direct funds transfer.
The funds from an MCA can assist a salon-based business in numerous ways, including paying for everyday costs such as staff wages, rent, inventory, or utilities. Additionally, salon owners might use their boost in working capital to update their salon equipment, hire additional assistance, or pay for exciting new marketing campaigns that will land them even more customers.
Tourism
Businesses within the tourism industry are especially subject to seasonal fluctuations, especially if running a waterpark, ski lodge, beach resort, or anything that requires specific environmental conditions.
In saying that, hotels, travel agencies, and tour companies also aren’t without their ebb and flow—especially as certain times throughout the year remain more popular for travel.
While the peak season may bring in extra income, tourism businesses still face challenges during the off-season. MCAs can assist in calming the storm that comes with a significant drop in business.
Seasonal Businesses
Some businesses might not belong to the categories mentioned previously; however, they still succumb to seasonal fluctuations based on weather conditions or time of year. Seasonal businesses include ice cream shops, snow removal services, swimwear shops, ski equipment retailers, and more.
During the off-season, many seasonal businesses repurpose their operations to keep their heads above water. In the summer, a snow removal service, for example, may become a lawn care service to meet seasonal demand.
For those unable to repurpose their primary business, however, an MCA may assist them to get by.
Does Your Business Require a Merchant Cash Advance?
If you’re struggling with seasonal fluctuations or want to take advantage of your high credit card sales, then help is at hand.
For businesses that have been in operation for a minimum of 6 months and receive over $10,000 in monthly sales, an MCA from Zinch may be the answer you’re looking for. Known as Zinch Flex, your funds are paid back with automatic percentage-based withdrawals from your credit card receipts. It’s fast, easy, and flexible.
Contact us at (714) 500-6622 to learn more about your options. You could qualify for up to $250,000 in just 24 hours.
