The restaurant industry has a reputation for being a tough but exciting one to work in – this is especially true for the small business owners behind it. In addition to a passion for food and considerable knowledge of the hospitality business, another key ingredient is needed for a restaurant business to be successful. Capital is essential throughout the lifespan of your restaurant business. Below are 8 ways that restaurant loans can help your business thrive.
1. Upgrade your Equipment or Furniture
A restaurant loan can give your business a game-changing boost if you use the capital to purchase or replace equipment. Some types of equipment, such as cooking and refrigeration are essential to the business and can be very costly. Fortunately, with a restaurant loan you can get the equipment you need without compromising on quality.
Other areas to invest in include furniture and décor. Small changes such as new chairs can go a long way. To truly switch things up – and generate some buzz – put your restaurant loan towards remodelling the dining room or bar.
2. Prepare for your Busy Season
The restaurant business is often seasonal, and preparing for high-season can require additional capital. You’ll likely have to extend your hours, hire and train seasonal staff, stock up on inventory for special events and seasonal updates, get new outdoor furniture, and provide a holiday menu. A short-term restaurant loan is ideal for investments like these because you are able to get a good return on your capital, pay off your loan quickly, and get ready for the next season.
3. Access Funds Quickly in a Crisis
When restaurant equipment breaks down it needs to be replaced or repaired immediately. Even a few days of downtime could be a recipe for disaster. Sometimes the restaurant space itself may need an emergency repair or cleaning. If a fire broke out in the kitchen or flooding ruined your dining room floor, you might find yourself in a bit of a pickle. Online restaurant loans are ideal for such emergencies, giving you access to funds as early as the next business day.
4. Stay Afloat During Slow Season
Just as there is a busy season, the hospitality industry often has to weather a slow season as well. During this time when revenue is down, a restaurant loan can provide much-needed cash flow to fund day-to-day operations. Many online lenders offer fast access to funds when you’re in a pinch, and flexible repayment terms, so you can pay down your loan early without penalty once business picks up again.
5. Expand to a Larger Space or Second Location
A packed dining room is a great problem to have in the restaurant industry. Moving to a larger space or opening a second location might be the right move, but before you can reap the benefits you need capital. Restaurant loans can go to securing a new space as well as setup costs such like furnishings, equipment and additional staff.
6. Ramp Up Marketing and Promotional Efforts
In the restaurant business, one day you could be the talk of the town, the next you could be struggling to fill seats. Marketing and promotion can help get people talking about your restaurant again. With a restaurant loan, you could improve your website, invest in a rebrand or refresh, purchase new signage or explore different marketing channels such as social media, public relations and advertising.
7. Build Credit for the future
Even if you don’t require a loan at this time, a small restaurant loan can help you build or improve your business credit. For more advice on this, read our recent blog post on how to build and improve your business credit.
8. Fund Startup Costs
Perhaps your restaurant dream is not a reality yet – you’re probably already aware that starting a restaurant requires significant upfront capital and it can take a long time to get your restaurant set up before you generate any revenue. Restaurant loans can give you the head start you need, but keep in mind many reputable creditors will only fund established businesses. Explore a range of financing options, including crowdfunding or loans specifically for startups.
Easy as Duck Soup
The restaurant business can be unpredictable and full of crises and opportunities. A restaurant loan can be the secret ingredient that helps you get through the lows and capitalize on the highs. Online lenders like Lendified are well equipped to meet the needs of Canadian restaurant owners, providing a quick and easy application process, instant decisions and funding in as fast as 48 hours. Lendified’s rates and terms are flexible, so you can set your terms and repay on your own schedule.
If you are interested in getting a restaurant loan offer (with no obligation) from Lendified click the button below. Our application takes less than 10 minutes to complete and our loans are more affordable than other alternative financing options.