Restaurants are the second-largest private sector employer with almost 660,755 restaurants in the US. Eating out is becoming a necessity for younger generation. If you are running a restaurant business, you better know that how much focus and determination is required to maintain the profitability of a restaurant business especially when the competition is so high. Due to the high competition level, staff turnover and other overheads, the failure rates of restaurants are also significant.

Restaurant industry is considered by most banks as a high risk sector. This makes it more difficult for restaurateurs to get funding for their business. Banks want to see account records of last couple of years that most new and young restaurants can’t provide. Alternative lenders have solved that problem.

Restaurant Loan

Restaurant loan is a type of business loan especially meant for restaurant businesses. For restaurant businesses that don’t qualify for traditional funding, a restaurant business loan from alternative lenders is the best funding option. This loan can help restaurant owners to run their business at full strength and get the best chance for sustained success.

When to Apply For a Restaurant Loan?


You can expand your restaurant or open new locations with restaurant loan. If you want to add another location, restaurant loan can help pay for your upfront costs of purchasing new location.

Inventory & Staffing

You can also use your restaurant business loan to purchase inventory and other supplies as well as for paying your employees and vendors when business is slow.


If any of your commercial kitchen equipment, such as dispenser and ovens, broke down, and needs replacement, you can use restaurant loan to buy or fix the equipment quickly and keep your business running effectively.

Equipment Purchase

Your oven suddenly stops working and you need to replace it quickly to avoid any temporary kitchen shutdowns.

Cash Flow

Alternately, you run a seasonal restaurant that’s busiest in the summer and you need cash to cover day-to-day operating expenses through the slower winter months.

Advertising & Marketing

You have decided to start marketing campaign and move into new advertising mediums that your current budget won’t accommodate.

Know What You Need to Apply

  • Profile of the loan applicant
  • Income Tax Return of the last three years (Personal or Business firm)
  • ID card/Address Proof
  • Documents of Collateral

Alternative Business Loan Options for Your Restaurant

  1. SBA Loans

SBA loans are the most common funding source for restaurant business owners. These loans are quite hard to acquire, and if you get approved for funding, you need to provide collateral and personal guarantee to get the funding.

  1. Working Capital Loans

Working capital loans are the basic types of business loan that can be used to fund your restaurant business. They are a best funding program to cover everything from getting your restaurant business off the ground to covering other expenses.

  1. Restaurant Equipment Leasing

With restaurant equipment leasing, restaurant owners can lease the required commercial kitchen equipment. The leasing program offers affordable monthly payments with customized terms. Restaurant equipment leasing also provides great tax benefits.

  1. Business Lines of Credit

A business line of credit is one of the fastest business funding program, designed to meet the needs of your restaurant business. In business line of credit settings, you only pay for what you use. Restaurant owners have been taking advantage of business lines of credit for discounts on bulk purchasing.

  1. Merchant Cash Advance

A merchant cash advance is not a loan it is a lump sum amount against your future credit/debit card sales. You can also use a merchant cash advance for your restaurant business. Cash advance is an excellent solution if you don’t want to be tied to a monthly payment. There is no collateral and personal guarantee requirement in this program.

To discuss more financing options for your restaurant business, please give us a call at (833) 827-4412. Alternatively, you can get a free quote online by filling our online application form, if you’re ready to apply.

Small Business Financing News │ Merchant Advisors | blog
Top 5 Business Loan Options for Restaurant Business
Top 5 Business Loan Options for Restaurant Business
Looking for funding to fund your small business? The road ahead is full of twists and turns because it does require a lot of time and research to locate the best funding program that suits your business. Due to theRead more
Are you in need of financing your restaurant business? We have rounded up the best business loan options for small business owners to get started with.
Merchant Advisors
Merchant Advisors