#beauty hair salon merchant cash advance financing

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Merchant Services for Beauty Salons

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Starbucks To Loan Small Businesses Millions Of Dollars

According to a press release, Starbucks Coffee Company is investing $10 million in four community lenders to generate economic opportunities in Chicago.

This investment will help fund more than 500 loans to support small business growth, support community development projects and create more jobs in underserved communities in Chicago.

Starbucks’ $10 million investment will split between Accion Chicago, the Chicago Community Loan Fund, the Local Initiative Support Corporation and the IFF, four community development financial institutions that create economic opportunities in neighborhoods in the city. In addition to the loan, the organizations will provide borrowers with mentorship and technical assistance to ensure the success of their projects.

This investment follows the Starbucks initiative to create jobs for the United States in partnership with OFN in 2011. The program aimed to create and maintain jobs in under-served communities in the United States through a philanthropic contribution of $5 million from the Starbucks Foundation. In three years, he has raised more than $15 million in donations. Participating CDFIs have been transformed into $105 million in business funding to create or maintain more than 5,000 jobs.

Bank of America will offer a helping hand to Starbucks in distributing the investment to each of the four lenders. CDFIs should begin lending to small business owners and community organizations by early next year, although borrowers can apply for a loan now. Residents of Chicagoland can learn more and apply for a loan by visiting the respective CDFI websites.

This news comes weeks before the opening of the Starbucks Reserve Roastery on the Chicago Magnificent Mile.

BENEFITS OF MERCHANT CASH ADVANCES

Whether you operate a store, café, or barbershop as a consumer business, it can be difficult to find funders who understand your business and can provide you with the money you need. A business advance can be the solution and an attractive option for companies like yours. A business advance is not a commercial loan or an overdraft. Funds are advanced for your business based on eligible card sales and for the sale of some of your future card purchases.

Some companies use these business loans to purchase inventory and equipment for renovation or repair work. Others use them to fill a gap in their cash flow or to finance unforeseen costs. They may have advantages over more traditional business financing methods, such as speed, simplified approval, more flexible fees and payments that match the level of your card sales.

WHO CAN USE A MERCHANT CASH ADVANCE

Companies that accept credit or debit cards may apply for a cash advance, but the sectors that could benefit include:

Restaurants

The bars

Hotels and Inns

Small businesses

Hair and Beauty Salons

Delicatessens or bakeries

Flower shops

In conclusion, a Merchant Cash Advance is an innovative approach to financing small business owners. Businesses can now access business loans by selling a portion of future card sales. In the absence of monthly payments and repayments from ordinary cash flows, a cash advance is a source of funding for real-world businesses with real needs.

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What are the Best Ways to Finance your Salon?

During the first few years of running a salon, you need to generate a positive cash flow while facing high overhead costs and an inconsistent revenue stream. This is not an easy task!

Financing the ebb and flow of a salon traditionally required taking out bank loans. That is assuming that the bank approved your loan for an infusion of liquidity to keep your salon moving forward. These days obtaining money from

traditional lending sources, such as banks, is becoming increasingly difficult. Thus many salon owners, like you, are searching for alternative methods to finance their salon operations. Here are the major overhead costs for operating a salon:

Payroll

Equipment

Inventory

Real Estate

Unfortunately, many banks consider beauty & hair salon to be high-risk investments. Similar to a restaurant, a beauty salon is highly vulnerable to the state of the economy.

Decreases in consumer purchasing power lead to fewer visits to salons for not only nail and facial services but also basic services such as haircuts. Salons typically require several years to build up a loyal base of customers. If a salon cannot receive approval for one of the best loans for beauty salons, how does a salon weather the inevitable financial storm? The answer lies in seeking funding from alternative sources.

The Best New Ways to Finance Your Salon in 2018

From purchasing new equipment to making payroll during the slower months of the year, raising capital for operating a salon requires outside the box financial thinking.

Alternative Online Loans Over the past decade, the online lending industry has grown enough to compete with traditional brick and mortar lenders. Online lender Kabbage approves loan amounts between $2,000 and $250,000, which offers your salon the liquidity it needs to pay taxes or expand the size of the building where you conduct business.

Repayment terms run between six and 12 months, with no origination or account maintenance fees. Funding takes up to two days, which makes the online lender ideal for salons that require emergency cash.

Fundbox operates a different type of online lender model. The user-friendly system, which you can run on a mobile phone app, processes cash advances that your salon pays back by transferring unpaid customer invoices.

Connected to your accounting software and business checking account, the automated system used by Fundbox increases the productivity of your salon. You spend less time crunching numbers and more time developing a regular customer base.

Merchant Cash Advance

When you need money to pay for unexpected expenses, a merchant cash advance provides the capital you need to keep the business door open. Merchant cash advances work best for small businesses that generate most of its revenue from debit and credit card sales. Retail businesses like salons can go hours per day without ringing up a cash sale. Merchant cash advance providers approve access to money in return for a percentage of future sales or weekly withdrawals from the salon bank account.

Rollover for Business Startup

You are aware that taking money out of a retirement account such as a 401K generates substantial penalties and tax charges. However, a rollover for business startup (ROBS) represents a creative option to tap into a 401K for a cash infusion to improve the financial health of your salon.

You do not have to pay an early withdrawal penalty or any taxes on the money withdrawn. Setting up a ROBS typically requires the expertise of a certified financial planner that specializes in helping small business owners acquire more liquidity.

Accounts Receivable Financing

For a salon, cash flow gaps occur for several reasons. Sales decline after holidays such as Christmas and Valentine’s Day. Summer can usher in a period of slow sales as well. If your salon experiences a deficit caused by declining sales and an increase in expenses, accounts receivable financing might be the alternative way to finance your salon in 2018. Lenders analyze your salon’s financial metrics not only to decide whether to approve accounts receivable financing but also to determine how much money to approve. kabbage is an excellent account receivable financing option for salon owners.

Does Invoice Financing Work for Salons?

Your salon has a short window between approving a credit card and receiving the cash derived from the credit card sale. Does this mean invoice financing is not for salon owners?

Also referred to as factoring, invoice financing involves lenders approving cash advances up to 80% of your outstanding invoices. Many salon owners have company accounts, which send several customers to the salon from the same company. Payment for the entire account occurs during an established billing cycle, which usually lasts 30 days. If you have numerous company accounts and you have to wait up to a month to receive payment for the accounts, then invoice financing is a viable option to finance your salon in 2018.

So, what is the next thing for you should do after having a beauty salon registered under your name? Well, the best thing you can to do is to get a salon website designed or a salon mobile application developed by the Online Salon Design Development Team. This for sure will get you close with your customers, get new clients, overall the better and bigger saloon business.

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