Business factoring is a scarcely utilized financial method that gives needed restaurant finance to merchants through their merchant account. Few business owners realize that they have this option and go straight to family or a bank when they need funds or small business loan to pay for growth, repairs or upgrades of their stock and equipment. If you are an entrepreneur in need of capital immediately, you should consider this type of merchant financing as well.
The concept behind business factoring through your merchant account is a bit like selling futures. You, as the merchant, agree to sell a portion of your future credit card revenues at a lesser price to the factoring company. The working capital is received now in exchange for future revenues in the next several months.
These agreements are most commonly for the short term, rarely more than one year, and are a viable way for a business with a verifiable credit card sales track record to obtain needed working capital.
Unlike a conventional restaurant loan, in which the repayment schedule is set for the entirety of the loan, restaurant finance through business factoring agreements take into account the fact that in nearly every establishment there are excellent months and slow ones. Your payment is directly tied to your credit card receipts, as a percentage, not a set number.
If you have decided to pay a ten percent daily capture and you take in $8,000 one month, your payment that month comes out to $800. In the next month you may charge $10,000 and pay $1,000. This flexibility is a great asset for a growing company though restaurant financing.
An extra benefit of business factoring is the quickness,short time in which the funds turns up in your hand. While a bank may take several months to make a decision and dictate how you utilize the funds when and if they give it to you, with a factoring arrangement, you will have the money in about 5 business days, and you can use it for whatever you see fit.
A restaurant finance provided through Business Cash Advance give a much needed, fast solution for businesses in need of working capital. Neither collateral nor years of financial statement are necessary to be considered for working capital when you work with a proven financing company. There are a lot brokers to choose from so you should to be sure that you shop around. Your business may be approved for a easier advance than first supplied and searching around at the alternative companies and programs they supply will ensure that you acquire the most beneficial offer for which you qualify. I would also suggest doing your due diligence prior to needing the cash. This way if the day arrives you will know precisely how to proceed.
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Source: http://blog.merchantcashfinder.com/?p=1427
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