The beauty salons and spa industry is currently flourishing and has grown over 2.7% annually. According to the Zion Market Research, beauty salons and spas market will reach $190.81 billion, globally, by the end of 2024. Recently due to the heavy competition between beauty salons and spa business, maintaining positive cash flow is almost impossible.
In this age, a wide range of health and beauty services are available in the market. They are striving to help people accept themselves as they are. Beauty salons and spas are held to a high standard as compared to other brick-and-mortar businesses. These businesses require a constant stream of working capital to keep their operations running efficiently. Getting funding to manage this working capital cycle can be difficult, sooner or later you might need funding to support your small business.
When to Apply For Business Loans for Beauty Salons?
Here are some of the instances when you need to apply for a business loan:
- Move to a new salon station
- Buy Dryers
- Install Pedicure Chairs
- Manicure station
- Nail Polish Racks
- Sanitation Stations
- Equipment Sanitizers
How a Business Loan Can Work for Your Beauty Salon?
o You can pay your beauty products supplier.
o Buy some expensive beauty products.
o For renovations and expansion of your salon.
o Purchase salon equipment.
o Strengthen your cash flow.
Below are your potential options, where you can go and ask for a loan:
- Local Bank
The first affordable funding option is your local bank. Banks are the cheapest source to get money, but if you are looking for a quick spa funding this might not work. Their application process is long and they have certain strict requirements. Usually, they opt for a secure medium.
- The Small Business Administration (SBA)
SBA approved a loan is also a great option, especially when you are running a Salon and Spa business. If the bank had rejected your plea so this might be something to consider. Then again, if you need urgent funding, this is not a good idea. However if approved for one, their longer terms and affordable rates can be a plus for you. But for that you should have an excellent credit score, and also need to provide substantial collateral.
- Business Credit Card
Want quick access to funds for a small business, this is the best option for you, it requires a credit card. If you don’t have one you, apply for it instantly. The advantage of this option is that you get to take care of the financial matters, personally. If you think you can handle the pressure, only then go with this option.
Alternative lenders have solved the problem by providing business loans for beauty salons and spas. Funding from alternative lenders is flexible and quick. Whatever your business’ objective is, you can get funding as quickly as possible with them.
Alternative Business Loans for Beauty Salon & Spas
- Small Business Loans
A small business loan is a funding program that can help you gather funds to spend on the growth of your spa and salon business. Whether you are looking to add a couple of seats in your salon or want to modify your services, it requires more equipment and workforce, a small business loan is what you are looking for!
- Equipment Financing
As the name refers, equipment financing is a funding program that can help you purchase the required equipment. Running a salon and spa business involves lots of equipment, right? And equipment loans can best serve you in purchasing that.
- Working Capital Loans
A best alternative funding program for strengthening the cash flow of your salon and spa business. This program is specially intended to fund and manage the cash flow of business. Working capital loans are short-term in nature and can be the best fit to cover current cash flow problems.
- Merchant Cash Advance
As everyone knows that it is not a loan, a merchant cash advance can be a great funding alternative for spa and salon businesses. You can borrow a specific amount of cash against your future credit/debit card sales. The repayment process of merchant cash advance is quite easy. The Cash Advance lender can deduct a small percentage from card sales. It can be on a daily or weekly basis.
- Business Lines of Credit
Business lines of credit is another alternative to business loans for spas and salons. Lines of credit are similar to credit cards. However, these lines come with lower APRs and higher credit limits and carry different repayment method. During the slow season, a business line of credit can be really helpful for a business to cover up its operational expenses.
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