Financing And Loan Options For Manufacturing Companies

Operating a manufacturing business is extremely rewarding. Whether you’re creating products that ship directly to retailers or you’re working with other manufacturers, the potential for profits is great. However, as you’ve likely already seen in your business, owning a manufacturing company isn’t all smooth sailing. In order to make those big profits, you have to invest in your business.

Once you have steady cash flow, it’s easy to cover day-to-day operating expenses. But what happens when your bank account is running a little low or a major expense poses a threat to your operations? From emergencies to expansions to cash flow shortages, there are multiple scenarios where you fall a little short financially.

Instead of worrying, take action. When your manufacturing business has an expense you can’t handle on your own, there are loan and financing options for any situation. Don’t panic if you’re unsure of where to start. In this post, we’ll cover the types of loans available for your business, how to choose the right lender, and what to expect when it’s time to apply.

Read on to learn more and take the next step to fund your manufacturing business.

Financing Need Best Loan Type Recommended Lender
Purchasing Equipment Equipment Financing Lendio
Purchasing Materials Line Of Credit FundBox
Business Expansion SBA Loan SmartBiz
Cash Shortages Invoice Factoring BlueVine
Hiring, Training & Covering Payroll Term Loan OnDeck
Marketing & Advertising Business Credit Card Chase Ink Preferred

How To Finance A Manufacturing Company

Your business is unique, and so are its financial needs. The type of loan or financial product you select is primarily centered on how you plan to use your funds. For example, if you want to purchase real estate, you should seek out long-term, low-interest options instead of a short-term loan. If you need to cover this month’s payroll, an equipment loan won’t help you out. The key is to identify why you need the money and select the right financial solution for your situation.

Purchasing Equipment

No matter what type of manufacturing business you operate, you need equipment to keep operations running efficiently. If you manufacture clothing or garments, sewing machines and pressing machines are essential equipment. If you operate a furniture manufacturing business, your business needs saws, planers, sanders, and other expensive tools and equipment.

Over time, your equipment may become old and outdated. Or maybe your equipment is still in good working order but you need to add more as part of an expansion. Either way, buying equipment doesn’t come cheap, and funding these expenses out-of-pocket can be tough, if not impossible. Instead of breaking the bank, you have a more affordable option: equipment financing.

Equipment Financing

When you receive an equipment loan, your lender will fund the full purchase price of your equipment. After paying a small down payment of 10% to 20%, you can take possession of the equipment and put it into use immediately. Then, you’ll simply make scheduled payments to your lender, which are applied to the balance of your loan (and toward any additional fees and interest charged for taking the loan).

With a high credit score, you may be able to qualify for $0 down financing. However, if at all possible, you should make a down payment to lower your scheduled payments and reduce the overall cost of borrowing.

Equipment loans can only be used to purchase equipment, including machinery, tools, furniture, fixtures, and vehicles. When you receive equipment financing, additional collateral is typically not required. Instead, the equipment being financed serves as the collateral and can be repossessed if payments are not made as agreed. Once your loan has been paid off, the equipment is yours to keep, sell, or trade.

Equipment leases are another option to consider. When you take out an equipment lease, you can use the equipment for a set period of time, such as 2 years. At the end of your lease, you have two options: pay a lump sum to purchase the equipment or return the equipment and sign another lease for new equipment. Unless you pay the remaining balance at the end of the lease, you will never take ownership of the equipment. This may be a good option for you if you update your equipment frequently or if you desire a lower down payment and lower monthly payments.

Recommended Option: Lendio

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Lendio isn’t a lender; rather, it is a loan aggregator that matches you with a lender that best fits your needs. One of the financial products offered through Lendio’s service is equipment loans.

Through Lendio, you can apply for $5,000 to $5 million to finance your equipment purchase. Repayment terms are available from 1 year to 5 years, with interest rates as low as 7.5%.

To qualify with a lender through Lendio’s network, a time in business of at least 12 months is required. You must also have at least $50,000 in annual revenue and a personal credit score of 650. If your credit score falls below this threshold, solid cash flow and revenue could still help you qualify for financing.

Purchasing Materials

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As a manufacturer, you need materials to manufacture your goods to sell to other manufacturers or retailers. When you don’t have the right materials, you can’t produce your goods, which negatively affects your revenue. If financial troubles prevent you from buying the materials you need, keep your business operating without a hitch by using a line of credit for your purchases.

Lines Of Credit

A line of credit is a flexible form of revolving credit. Instead of receiving a lump sum payment, your lender will assign a credit limit. You can make draws from your credit line as often as you need for any amount within your set limit. This is ideal when you need to make multiple purchases over a period of time or you’re unsure of the exact amount of money you need.

You can use your line of credit for any business expense, including purchasing supplies, materials, and inventory. Once you make a draw from your line of credit, the funds are typically transferred immediately and will be deposited in your business bank account as soon as the next business day. Interest or fees are charged only on the used portion of the credit line. As you pay down your balance, the funds will become available for you to use again.

It’s easy for most business owners to qualify for a line of credit. However, the best rates and terms and the highest credit limits are given to the most established, creditworthy businesses.

Recommended Option: FundBox

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FundBox provides revolving lines of credit up to $100,000. When you make a draw, payments are made over a period of 12 or 24 weeks. Equal payments are made weekly and are withdrawn directly from your checking account.

Fees for drawing from your Fundbox line of credit start at 4.66% of the total draw amount. Your fee will be based on the health of your business. If you repay early, any remaining fees are waived, helping you save money.

To qualify for a Fundbox line of credit, you must have a business checking account and at least $50,000 in annual revenue. You must show two months of activity in Fundbox-supported accounting software. If you don’t have activity in accounting software, bank statements from the last three months are acceptable.

Business Expansion

Your business is growing, and it’s time to expand. There’s just one problem: expansion costs money that you don’t have. Purchasing commercial real estate, funding improvements for your facility, building an addition, or constructing a new building all come at a price that even the most successful manufacturing companies can’t pay up front. When it’s time to expand your business, move forward with confidence with the help of a Small Business Administration loan.

SBA Loans

The Small Business Administration provides a variety of resources to help small business owners succeed. One of the best resources is the organization’s low-cost, flexible loan options. SBA loans are available through lenders known as intermediaries. This could be banks, credit unions, or nonprofit organizations.

If you’ve applied for a business loan through a traditional lender like a bank, you may have been turned down. With an SBA loan, your chances for approval are higher because these loans are guaranteed by the government in amounts up to 85%, so there’s less risk for the lender.

One of the most popular types of loans for large expenses like business expansion is the 7(a) loan. With a 7(a) loan, up to $5 million is available to qualified businesses for nearly any business purchase, including commercial real estate, land development, improvements and upgrades, equipment, and more. Loan terms are set at 10 years for most purposes, although real estate purchases have terms up to 25 years.

The cost of borrowing varies based on the type of loan you select and the amount borrowed. The SBA has a set of standards used by its intermediary lenders to keep interest rates low, making loans more affordable for business owners.

Recommended Option: SmartBiz

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Applying for an SBA loan doesn’t have to be difficult or stressful when you work with a lender like SmartBiz. SmartBiz simplifies the SBA application process, helping you get the money you need as quickly as possible.
There are two types of SBA loans available through SmartBiz: working capital and debt refinancing loans and SBA 7(a) commercial real estate loans.

With working capital and debt refinancing loans, you can apply for $30,000 to $350,000 to use for business expansion, marketing, hiring employees, purchasing inventory, or refinancing existing debt. Interest rates are between 8% and 9% with repayment terms of 10 years. To qualify, you must be in business for at least 2 years and have a personal credit score of at least 650.

SmartBiz also offers SBA 7(a) commercial real estate loans from $500,000 to $5 million. You can use these funds to purchase a new commercial property or refinance your existing property. Rates are between 6.75% and 8% with repayment terms of 25 years. To qualify for this loan, you must be in business for at least 2 years with a credit score of at least 675. Any property funded with loan proceeds must be at least 51% owner-occupied.

Additional requirements for SBA loans include no outstanding tax liens, recent charge-offs, or defaults on government loans. You must not have any bankruptcies or foreclosures within the last 3 years. You must also qualify as a small business based on the SBA’s definition, which limits your company’s net worth, number of employees, and annual revenues.

Cash Shortages

Cash shortages happen to everyone. A seasonal drop in sales, an unexpected emergency expense, or another situation could leave your bank account running a little short. Sometimes, the real problem is your unpaid invoices. For times when money is tight, invoice factoring can help make up for these shortages.

Invoice Factoring

Unpaid invoices can leave you in a financial bind. Instead of waiting weeks or months to receive payment, consider invoice factoring. If you’re a B2B business and you have unpaid invoices, you may qualify for this type of financing. With invoice factoring, a lender pays a large portion of an unpaid invoice directly to you. Once the invoice is paid by the customer, the remaining amount of the invoice is paid to you after the lender takes any fees charged for the service.

With invoice factoring, the invoices are the collateral for the loan. A high credit score is typically not needed to qualify. Your invoices are the most important factor in this type of financing. A lender will ensure that your invoices are a sufficient amount to cover any fees. Lenders will also make sure that your invoices are for customers who are likely to pay.

Recommended Option: BlueVine

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BlueVine has invoice factoring lines up to $5 million. Rates may be as low as 0.25% per week. You can receive approval in as little as 24 hours when working with BlueVine.

To qualify, you must be in business for at least 3 months and have at least $100,000 in annual revenue. You must be a B2B business and have a personal credit score of at least 530.

Hiring, Training & Covering Payroll

It’s time to expand your business, which means hiring and training new employees, but your funding falls short. Maybe you’re not ready for expansion, and your business is struggling just to cover your current payroll. No matter the situation, a term loan can help.

Term Loans

When you apply for a term loan, you’ll receive a lump sum of money that can be used for any purpose, including hiring, training, covering payroll, or for use as working capital. The terms of these loans vary. While some lenders provide loans for up to 12 months, other lenders may offer repayment terms of several years.

If you’re applying for a short-term loan, one difference you may notice is that a factor rate is used to calculate how much you owe. This multiplier is used to determine the one-time fee that is added to the cost of your loan, replacing a traditional interest rate. The factor rate is based on the lender’s policies, as well as the creditworthiness of the borrower.

Other term loans have a traditional interest rate. Your interest rate and repayment terms will be based upon your creditworthiness and ability to pay back the loan.

One thing to note is that some term loans, such as short-term loans with low borrowing requirements, come at a very high cost. As with any other type of financing, shop around to find the best rates and terms for your business.

Recommended Option: OnDeck

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OnDeck has loan options up to $500,000 for qualified borrowers. There are two different loan options available. Short-term loans come with repayment terms between 3 and 12 months. These loans have simple interest starting at 9%.

Loan options with longer terms are also available. These loans come with terms of 15 to 36 months with annual interest rates starting at 9.99%.

For all loans, origination fees are charged by the lender. For the first loan, fees are between 2.5% and 4% of the total loan amount. Subsequent loans have reduced fees.

To qualify, you must be in business for at least one year and have a gross annual revenue of $100,000. You must have a personal credit score of at least 500 to qualify. Daily or weekly payments are automatically deducted from your checking account.

If you’re looking for other financing options, OnDeck also has lines of credit up to $100,000.

Marketing & Advertising

You want to get the word out about your business to bring in more customers and increase your revenue. Word-of-mouth and free social media advertising may bring more customers your way, but you’re not going to scale at a higher level until you launch a paid marketing and advertising campaign.

Marketing and advertising can get expensive very quickly, although the return on investment is often high enough to justify this expense. But what happens when you just don’t have the extra funds to market and advertise your business and services? A business credit card can help, and you can even be rewarded just for using it.

Business Credit Cards

One of the best things about a business credit card is that it can be used any time for any business purpose. When you have marketing and advertising expenses that need to be covered, you won’t have to wait days or weeks to get financing approval. Instead, you’ll be able to use your credit card immediately to cover the expense.

A business credit card is great for marketing and advertising campaigns because you won’t have to request a specific amount. You can use your card as needed to cover any expense, whether it’s marketing and advertising costs or an emergency expense.

When you’re approved for a business credit card, your lender will provide you with a credit limit. Your purchases can’t exceed the credit limit assigned to your card. You can make multiple purchases with different vendors as needed provided you don’t exceed your credit limit. Each month, you’ll pay at least a minimum payment that will be applied to the borrowed balance and the interest charged on used funds.

Business credit cards can be a very expensive form of financing if you only make the minimum payment each month. Cut down on the amount of interest you pay and the overall cost of borrowing by using your credit card responsibly and paying all or a significant portion of your balance each month.

Business credit cards are available for all types of credit situations. Borrowers with the highest scores will receive the lowest rates and highest credit limits, in addition to the best rewards cards, introductory rates, and bonus offers. There are options available for fair credit scores that come with higher rates and lower limits. For bad credit borrowers, a secured card requires a cash deposit but helps you rebuild your credit and qualify for additional cards and financial products with responsible use.

Recommended Option: Chase Ink Business Preferred

Chase Ink Business Preferred



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Annual Fee:


$95

 

Purchase APR:


17.99% – 22.99%, Variable

If you have good to excellent credit and need a business credit card, consider applying for the Chase Ink Business Preferred card. This card has a variable APR of 17.99% to 22.99%. There is a $95 annual fee associated with this card.

This credit card is great for marketing and advertising expenses. You’ll earn 3 points for every $1 spent on advertising purchases with search engines and social media platforms. You’ll also earn 3 points for every $1 for shipping purchases, travel, cable, internet, and phone purchases. It’s important to note that this offer is only valid for the first $150,000 spent in combined purchases.

For all other purchases, you’ll receive 1 point for every $1 spent. If you redeem your points for travel through Chase Ultimate Rewards, they’re worth 25% more, giving you the most bang for your buck.

The Chase Ink Business Preferred Card also has a bonus offer of 80,000 points when you spend at least $5,000 within three months of opening the account.

Does The Government Offer Loans For Manufacturing Companies?

There are so many options when it comes to financing your manufacturing company. You have traditional lenders like banks and credit unions. You have alternative lenders that you can seek out online. You even have government loan options available to you.

One of the most popular government loan options has already been discussed in this post: SBA loans. These loans are backed by the government, so lenders feel more comfortable approving them since there’s less risk. In addition to the 7(a) loan that is open to any qualified small business owner, the SBA has programs for veterans, startups, and businesses operating in underserved areas.

Another option to consider is the United States Department of Agriculture’s Business & Industry Loan Program. This government-backed loan program allows lenders to provide affordable loans to businesses that don’t qualify for traditional financing. Any business that saves or creates jobs in a rural area is eligible to apply. This includes manufacturing businesses.

These loans can be used for almost any purpose, including acquiring a business, updating or constructing facilities, purchasing equipment and supplies, paying startup costs, or for use as working capital. Loan proceeds can also be used to refinance certain types of debt. These loans come with terms between 7 and 30 years. Most loans distributed through this program are between $200,000 and $5 million.

The Best Loan Options For Starting A Manufacturing Business

The options previously discussed work well for established businesses, but what happens when you need financing for a manufacturing business that hasn’t even been started yet? You need capital to fund your venture, but it seems impossible to receive a loan … or is it?

If you need capital to start a manufacturing business, you have to know where to look. At times, you may even have to get a little creative. Since traditional lenders like banks prefer to work with low-risk borrowers, you won’t be able to receive a loan, right? Not exactly. If you have a high personal credit score, you can apply for a personal loan through your bank, credit union, or another lender for money to start your business. Since it’s a personal loan and not a business loan, your business information — or lack thereof — won’t be a consideration for approval. You will, however, need a solid credit score and income that is sufficient to pay back the loan.

Lender Borrowing Amount Term Interest Rate Min. Credit Score Next Steps

$2K – $25K 2 – 4 years 15.49% to 30% 600 Apply Now

$1K – $50K 3 or 5 years 8.16% – 27.99% 620 Apply Now

$2K – $35K 3 or 5 years 6.95% – 35.99% APR 640 Apply Now

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$1K – $40K 3 or 5 years 5.32% – 30.99% 640 Compare

If you don’t want to go that route, there are additional options. Microloans are perfect for startups and new businesses. The SBA Microloans program provides up to $50,000 for startups, new businesses, and established companies. These loans are available through nonprofit intermediary lenders. Other nonprofit organizations also provide microloans to eligible business and startup owners.

You can also look to private investors. Peer-to-peer loans have less stringent requirements than traditional loans and may be an option to explore. You can also spread the word about your business and appeal to investors with crowdfunding. If you have a family member or friend that believes in your business and has money to invest, a loan from that person is a possibility. Just remember, no matter who gives you the money, borrow responsibly, read and understand all contracts, and pay your loan as agreed to start your business off on the right foot.

What To Consider When Choosing A Lender

5 C's of Credit: What Lenders Look For

Now that you’re familiar with the types of loans available for your manufacturing business, you may be tempted to jump online and start an application. Before you apply, you still need to choose a lender. The internet gives us access to more lenders than ever, so you may be tempted to just pick and choose based on what your search engine pulls up. However, a smart business owner knows the importance of shopping around for the best rates and terms.

Before you choose a lender, consider these factors to help narrow down your choices so you can feel confident that you’ve selected the most affordable financing option for your situation.

What Is The Loan Used For?

This question should be easy to answer. Why do you need money? Once you know how you’re using the money, you can choose the type of loan that’s best for the situation. For example, if you need a more flexible option for making purchases or in case of an emergency, apply for a line of credit or credit card. If you want to make an expensive real estate purchase, you don’t want a high-cost, short-term option. Instead, an SBA loan would be the best choice.

Once you know which type of loan you need, you can narrow your search to include only those lenders offering these products. You won’t apply with a short-term lender for an SBA loan or a lender that specializes in equipment loans when you need a flexible line of credit. Choose your loan, then narrow down your pool of lenders based on your business needs.

How Much Money Do I Need?

This is another simple question. How much money do you need? If you want to purchase equipment that costs $150,000, a lender that has maximum loan amounts of $100,000 won’t be a match. Before you fill out an application, calculate how much you need, how much you can afford, and find a lender that offers that amount.

Do I Qualify?

Applying for loans you won’t qualify for is simply a waste of time. If a lender has annual revenue, time in business, or credit requirements you just don’t meet, move on to another option. If you have challenges in these areas, find a lender that works with your specific situation. For example, if your credit score is low, consider loan options that are based on the performance of your business. If you have a new business, apply for loan options that work for startups and new businesses, like microloans. Also, take collateral and down payment requirements into account when selecting your lender and applying for a loan.

One important step to take before you apply for a loan is to know your credit score. Pull your free credit score online and review your credit report for errors. If your financing need isn’t immediate, take steps to raise your score if it’s low. With an improved credit score, you’ll qualify for more financing options that are more affordable and come with more favorable terms.

Do The Rates & Terms Work For My Business?

A loan may help you out right now, but you have to consider whether it will benefit your business over the long term. You want to select a lender that offers loans with the lowest rates and best terms you are qualified to receive. A short-term loan may be funded fast, but daily payments and a high factor rate could become a burden. In this situation, you could save hundreds or even thousands of dollars by waiting for a long-term option with better rates and terms.

Of course, in some situations, getting a loan quickly is important. Even so, shop around to make sure that you get a loan that you’ll be able to afford that has payment terms that are best for your business.

What You’ll Need To Apply For A Loan

Some types of financing for your manufacturing business require very little information about yourself and your business. For example, your name, business name, federal tax ID, social security number, contact information, and annual revenue may be all that’s required to qualify for a business credit card. However, there are other loans that require much more information and documentation before you’re approved.

Before you apply, you can get the specific requirements from your lender. However, you may want to go ahead and gather a few documents, including:

  • Business & Personal Tax Returns
  • Business & Personal Credit Scores/Reports
  • Business & Personal Bank Statements
  • Profit & Loss Statements
  • Balance Sheets
  • Licenses & Articles Of Incorporation
  • Business Plan
  • Future Projections
  • Account Numbers & Balances If Refinancing Debt

Your requirements may vary based on the lender you select, the type of loan you’re applying to receive, and the amount of your loan. Sometimes, a lender may even require additional information after you’ve submitted your application and documentation. Be prepared to offer this additional information promptly to move one step closer to approval and funding.

Final Thoughts

You need money just to keep your manufacturing business operating each day. This amount increases even more when you face a challenging situation, from growth and expansion to emergency expenses.

When you need money, it’s important to not stress yourself out over the situation and remember that you have financial options. Take a deep breath, run some calculations, pick your lender, and apply for the financing you need. You’ll be out of your financial rut and heading toward success again in no time.

The post Financing And Loan Options For Manufacturing Companies appeared first on Merchant Maverick.

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Business Loans And Other Financing Options For Wholesale Distribution Companies

Wholesale distributors play a critical role in the retail supply chain. It is crucial for a wholesale distributing business to be a well-oiled machine: storing manufacturers’ products, then shipping them as needed to retailers, which then sell these products to customers. If the wholesale distributor fails in its critical tasks, retailers won’t have the products they need, leading to many unhappy customers.

Like it is for other businesses, one of the most important resources for the success of a wholesale distribution company is capital. Heavy equipment, warehouse space, and inventory requirements are just a few of the big expenses these companies face. Incoming cash flows certainly help fund day-to-day operations, but what happens when more capital is needed than is readily available in your checking account?

If you’re running short on funds, a business loan can help. Before signing the dotted line for a loan, read on to explore the different types of financing available to you, which options are best for your situation, and how to kick-off the application process.

Financing Need Best Loan Type Recommended Lender
Purchasing Equipment Equipment Financing Lendio
Business Expansion SBA Loan SmartBiz
Purchasing Inventory Line Of Credit Kabbage
Cash Shortages Invoice Financing BlueVine
Emergency Funding Business Credit Card Chase Ink Business Unlimited

Why Take Out A Loan For A Wholesale Distribution Business?

If you’re in the wholesale distribution business, you may be familiar with situations where you’re running a little short on cash. Whether your business is booming and you need to expand your facilities or your bank account is too low to purchase inventory for a seasonal uptick, there will be times when you need extra money.

With a business loan, you’ll receive the money you need right away with the benefit of being able to pay it back over time. Since there are many different types of loans, the type you choose should be based on the unique financial needs of your business.

Purchasing Equipment

As a wholesale distribution company, your business is reliant upon heavy equipment. From forklifts and pallet jacks that are used in your warehouse to delivery vehicles, software, and mailing systems, your business requires equipment to be efficient. Unfortunately, this equipment doesn’t come cheap.

Whether you’re updating your equipment or adding new equipment as part of your expansion, make these large purchases more affordable for your business by applying for equipment financing.

Equipment Financing

Equipment financing is a type of funding that is used for the purchase of equipment. Instead of paying the full cost up front, you’ll pay a smaller down payment — typically 10% to 20% of the equipment’s cost — and be able to put the equipment into use immediately. You’ll make payments on a scheduled basis to your lender on the balance of the loan. Interest is also charged by the lender for providing the service. The equipment purchased with loan proceeds is the collateral for this type of financing.

There are two main types of equipment financing to consider: equipment loans and equipment leases. With an equipment loan, you’ll make a down payment, followed by regularly scheduled payments. At the end of the repayment term, you take ownership of the equipment. At this time, the equipment is yours to keep, sell, or trade. You own it free and clear.

With an equipment lease, you may also pay a down payment, although it’s typically lower than the down payment required with an equipment loan. You’ll make regular payments for the duration of the lease, which is typically around 2 years. Once your lease is over, you return the equipment and upgrade with a new lease, or you may have the option to pay a lump sum to take ownership of the equipment. While you’re essentially “renting” the equipment, a lease may be a consideration if you want a lower down payment or if you upgrade your equipment frequently.

Credit and revenue requirements vary by lender, but borrowers with solid credit histories and strong businesses qualify for the lowest rates, best terms, and lower down payments.

Recommended Option: Lendio

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Lendio isn’t a direct lender. This loan aggregator allows you to submit just one application to connect with multiple lenders, so you can shop for a loan more efficiently. Through Lendio, you’ll find the most affordable equipment loan for your situation.

Lendio offers access to equipment loans from $5,000 to $5 million. Loan terms are spread out over 1 to 5 years, with interest rates as low as 7.5% for the most qualified borrowers.

To qualify, you must be in business for at least 1 year, have a minimum annual revenue of $50,000, and a personal credit score of at least 650. If your credit score doesn’t meet the minimum requirements, you may qualify based on your cash flow and revenue over the last 3 to 6 months.

Business Expansion

Expansion is a good sign — it means that your business is growing. The drawback, however, is that expanding your business takes money, and you may be stalling because you don’t have the funds. When your business is ready to grow, follow the lead of other smart business owners by applying for a Small Business Administration loan.

SBA Loans

The Small Business Administration, or SBA, has loan programs to provide affordable, flexible financing for businesses that encounter difficulties when applying for loans from traditional lenders.

Loan Program Description More

7(a) Loans

Small business loans that can be used for many many business purchases, such as working capital, business expansion, and equipment, inventory, and real estate purchasing.

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Microloans

Small loans, with a maximum of $50,000, which can be used for working capital, inventory, equipment, or other business projects.

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CDC/504 Loans

Large loans used to acquire fixed assets such as real estate or equipment. 504 Loans are offered in partnership with Community Development Companies (CDCs) and banks.

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Disaster Loans

Loans used to rebuild or maintain business following a disaster. 

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SBA loans are backed by the government in amounts up to 85%, so there’s less risk for lenders and higher rates of approval when compared to bank or credit union loans.

There are several programs offered by the SBA. One of the most popular is the 7(a) program. SBA 7(a) loans can be used for almost any business purpose, from real estate purchases to working capital. With a 7(a) loan, you receive up to $5 million with repayment terms up to 25 years. Interest rates are set by the SBA, so these loans are extremely competitive and affordable. SBA 7(a) loans are available through SBA-approved lenders known as intermediaries.

When you’re expanding your business, 7(a) loan funds can be used to purchase land or real estate, pay for improvements in your facilities, or purchase equipment. High borrowing amounts, low interest rates, and flexible usage make 7(a) loans a popular choice among business owners.

For business expansion, another SBA loan to consider is the CDC/504 loan. Through this program, up to 40% of your project costs are funded by an SBA-approved Certified Development Company. A traditional lender provides 50% of the project costs, while you’re responsible for the remaining 10%.

Recommended Option: SmartBiz

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If you’re familiar with SBA loans, you’ve probably heard that the application process is difficult and time-consuming. If the process is intimidating to you, SmartBiz has made it easier for business owners to receive the capital they need.
SmartBiz offers SBA commercial real estate loans for $500,000 to $5 million for qualified borrowers. The interest rate is set at the base rate plus up to 2.75%. As of November 2018, rates are between 6.75% and 8%. Repayment terms are available up to 25 years.

With a commercial real estate loan, you can refinance your commercial mortgage, purchase the property you’re currently occupying, or buy a new commercial property.

SmartBiz also offers working capital and debt refinancing loans between $30,000 and $350,000 with rates between 8% and 9%. Repayment terms for these loans are 10 to 25 years. Loans can be used to purchase equipment, hire new employees, or for other business expansion plans.

To qualify for SBA working capital loans, a minimum credit score of 650 is required. Commercial real estate loans require a credit score of at least 660. The time in business requirement is at least 2 years. No bankruptcies or foreclosures within the last 3 years, open tax liens, and outstanding collections should appear on your credit report.

Anyone who has been delinquent or defaulted on a government loan in the past is not eligible to receive an SBA loan. If real estate is being purchased, the property must be at least 51% owner-occupied. Your business must also be considered a “small business” as defined by the SBA. Depending on the amount of the loan and your credit history, collateral may be required.

Purchasing Inventory

Your retailers depend on you to ship the inventory they need for their brick-and-mortar and online shops. If you don’t have the inventory in stock, you can’t make your shipments. If you don’t make your shipments, you lose business and the revenue that comes with it.

It’s not uncommon to face financial burdens that make purchasing inventory more difficult. A seasonal increase in orders that brings higher expenses, an unexpected emergency, or another situation could prevent you from purchasing needed inventory. Fortunately, there’s a solution: a line of credit that can help you through these tough financial times.

Lines Of Credit

A line of credit works like a credit card. However, instead of using a card to make purchases, you make draws from your line of credit. With every draw, the money is sent directly to your checking account. These funds can be used for any business expense, including the purchase of inventory.

A line of credit is a flexible financing option. Instead of receiving a lump sum for a specific amount, your lender will provide you with a credit limit. You can make multiple draws as needed up to this credit limit. You only pay fees or interest on the portion of the credit that has been used. Most lenders initiate transfers immediately, so you can have funds as soon as the next business day.

Rates, repayment terms, and credit limits vary. With most lenders, a solid credit score yields the best interest rates and terms. If you have a low personal credit score, there are lenders that evaluate the performance of your business to approve your line of credit and set your credit limit.

Recommended Option: Kabbage

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Kabbage provides lines of credit up to $250,000. Depending on the amount borrowed, repayment terms are set at 6 or 12 months. Kabbage charges a monthly fee with rates between 1.5% and 10% on the borrowed portion of funds. If you pay your balance off early, you’ll save money on monthly fees.

To qualify, you must be in business for at least one year. Revenue requirements are as follows: $50,000 in annual revenue or $4,200 in monthly revenues for each of the last three months. When you apply for a line of credit, you’ll link your business accounts — including PayPal, QuickBooks, eBay, and your business checking — so that the lender can assess the health of your business and issue your approval and credit limit. There are no personal credit requirements to qualify.

The application process takes fewer than 10 minutes, and you can be approved immediately. When making draws, transfers are immediate and you can receive your funds as soon as the next business day. However, Kabbage also offers the Kabbage card, which gives you instant access to the funding you need. When using your Kabbage card, a new loan will be taken out with the same rates and terms as traditional draws.

Cash Shortages

Cash shortages happen in any business. In the distribution industry, there are a number of reasons this can occur, including slow-paying customers. It’s not uncommon to have unpaid invoices that have impacted your incoming cash flow. If you’re facing this problem and waiting for payments is affecting your operations, why not use invoice financing to help fill in the gaps?

Invoice Financing

Invoice financing is available for B2B business (like distributors) that are suffering from unpaid invoices and need money immediately to cover business expenses.

The invoices serve as the collateral, and with many lenders, you don’t need a high personal credit score to receive a loan. Instead, the lender will consider the quality and quantity of your unpaid invoices. Your invoices should be of a sufficient amount to cover any fees or interest associated with a loan, and your invoices must be for customers who are likely to pay.

Invoice factoring is one type of invoice financing. The lender pays a portion of the unpaid invoice directly to you. After the lender collects payment from your customer, you’ll receive the remaining balance after fees and interest have been taken out.

With invoice discounting, you’ll receive most of the balance up front. After you collect payment from your customers, you’ll repay the loan along with interest and fees to the lender.

Invoice Financing Invoice Factoring

Uses invoices as collateral for a line of credit

Sell invoices for immediate cash

You are granted a credit facility based on the value of your unpaid invoices, and can draw from your available funds at any time

Factor gives you an advance when the invoice is sent and sends you the rest once the customer pays (minus a factoring fee)

You are responsible for collecting invoice payments

Factor is responsible for collecting invoice payments

Recommended Option: BlueVine

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BlueVine is a lender that provides invoice factoring lines up to $5 million. The factoring fees for receiving the line of credit start at 0.25% per week. BlueVine pays 85% to 90% of your invoice amount up front, and pays the remainder, minus fees, after the invoice is paid.

To qualify, you must have a minimum personal credit score of 530 and a time in business of at least 3 months. You must be a B2B business with qualifying invoices and at least $100,000 in annual revenue. The application process takes about 10 minutes, and you can be approved for financing as quickly as 24 hours after applying.

Emergency Funding

Emergencies happen, and often, these emergencies come with unexpected expenses. When these emergencies occur, time is of the essence. A flexible form of financing, like a business credit card, can help you get over these financial hurdles and even reward you for responsible borrowing.

Business Credit Cards

A business credit card is a great resource to have if an emergency arises. Once you’ve been approved for a business credit card, you can put it into use immediately. You won’t need additional approval to use your card, and you won’t have to wait on money transfers.

Once you’re approved for a business credit card, your lender will set a credit limit. You can make multiple purchases as needed up to this credit limit, so you can cover your emergency, purchase supplies and inventory, or tackle other business expenses. The borrowed portion of funds will incur interest based on the rate assigned by the lender. The sooner you pay down or pay off your balance, the more affordable this financing becomes. As you pay down your balance, funds become available to use again.

With a solid credit history, you’ll receive lower interest rates and a higher credit limit. There are options available for high-risk borrowers with low credit scores, including secured cards, which require a deposit and can help build credit.

Some of the best business credit cards have rewards programs. With every purchase, you’ll receive points to redeem for perks or cash back offers as a reward for responsible use.

Recommended Option: Chase Ink Business Unlimited

Chase Ink Business Unlimited


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Annual Fee:


$0

 

Purchase APR:


15.24% – 21.24%, Variable

The Chase Ink Business Unlimited card is targeted at borrowers with good to excellent credit. This card comes with no annual fee and an introductory APR of 0% for the first 12 months. After the introductory period, the Chase Ink Business Unlimited has variable APR of 15.24% to 21.24%.

In addition to competitive rates, the Chase Ink Business Unlimited card gives 1.5% cash back on all purchases. The card also has a bonus offer of $500 cash back after spending $3,000 within the first 3 months of opening your account.

If you don’t qualify for the Chase Ink Business Unlimited card due to your credit score, check out other business credit card options for fair credit and bad credit.

The Best Loan Options For Starting A Distribution Business

If you’re an established business with proof of solid performance, getting a business loan isn’t difficult. However, what if your financial needs are different? What do you do when you need money to get your business started?

Getting a loan to start a distribution business can be a challenge. After all, traditional lenders like banks and credit unions want to work with established, low-risk businesses. Because your business is non-existent or very new, you haven’t yet proven yourself to these lenders. But that doesn’t mean you’re completely out of options. You may just have to get a little more creative and dig a little deeper to find a lender that will work with your situation.

In addition to the SBA loans we’ve already discussed, the SBA has a Microloans program that’s suitable for new businesses and startups.

SBA 504 Loans

Borrowing Amount

$500 – $50,000

Term Lengths

Up to 6 years

Interest Rates

6.5% – 13%

Borrowing Fees

Possible fees from the loan issuer

Personal Guarantee

Guarantee required from anybody who owns at least 20% of the business

Collateral

Collateral normally required, but depends on the lender

Down Payment

  • No down payment for most businesses
  • Possible 20% down payment for startups
  • Possible 10% down payment for business acquisition loan

SBA-approved nonprofit lenders can provide up to $50,000, although the typical loan is around $13,000. Loan proceeds can be used to purchase inventory, supplies, fixtures, furniture, or equipment. Funds can also be used as working capital. Rates can’t exceed the limits set by the SBA and are generally between 8% and 13%. Borrower requirements include a credit score in the high 600s and qualifying as a small business based on the SBA’s definition.

If you don’t qualify for an SBA Microloan, other nonprofit organizations have microloan programs available. Credit requirements, maximum borrowing amounts, rates, and terms vary by lender. In addition to microloans, many nonprofits offer additional resources for new business owners, including training, classes, and mentorships. Looking for a microlender? Check out the options below.

Lender Max. Borrowing Amount Rates Req. Credit Score Next Steps

$500,000

2.9% – 18.72% factor rate

550

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$250,000

9% – 36% factor rate

500

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$500,000

9.4% – 99.7% APR

500

Apply Now

Another financing option to cover startup expenses is a personal loan. If you have a high credit score, you may be able to obtain a personal loan with low rates that can be used to fund your business. Approval for a personal loan will be based on your personal credit score and history, as well as your personal income. The following lenders offer reasonable rates for personal loans that can be used for business:

Lender Borrowing Amount Term Interest Rate Min. Credit Score Next Steps

$2K – $25K 2 – 4 years 15.49% to 30% 600 Apply Now

$1K – $50K 3 or 5 years 8.16% – 27.99% 620 Apply Now

$2K – $35K 3 or 5 years 6.95% – 35.99% APR 640 Apply Now

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$1K – $40K 3 or 5 years 5.32% – 30.99% 640 Compare

You can also jump online and look into peer-to-peer lending options and crowdfunding. Peer-to-peer loans are often easier to qualify for than traditional bank loans, while crowdfunding allows you to use a platform to raise money from investors.

Finally, loans from a friend or family member could be an option that works for you. Make sure that any loan agreement is on paper and signed by all parties involved. Be careful to treat the loan just as you would any other by paying it back on time as scheduled.

What To Consider When Choosing A Lender

In order to receive a loan, you have to choose a lender that is willing to work with you. In the past, most business loans were obtained from a bank, credit union, or another traditional lender. Today, there are more options than ever thanks to online lending.

The good news is that with so many lenders, it’s easy to find at least one willing to work with you – even if you have credit challenges, a short time in business, low annual revenues, or other factors that would disqualify you from traditional loans. The bad news is that finding the right lender can be overwhelming. With so many choices, which is best for you? To narrow down the lender pool, ask yourself these key questions to find the best loan for your financial situation.

How Will I Use The Loan?

This should be an easy question to answer. Why do you need a loan? Did an emergency expense pop up out of the blue? Have you been planning an expansion for the last 6 months and you’re ready to take action? By knowing how you plan to use the loan, you’ll be able to select the loan product best for that situation and can narrow down your selection of lenders.

Let’s say you want to expand your business and need a commercial real estate loan. In this case, lenders that offer short-term loans or lines of credit with low limits wouldn’t be the right choice. Instead, you’d want to find lenders that offer long-term loans with low interest rates, like SBA loans.

How Much Money Do I Need?

You should never apply for a loan without an idea of how much you need and how much you can afford to borrow. Taking money just because a lender offers it is can lead to unnecessary debt that can negatively impact your business. Instead, run some calculations and borrow only what you truly need.

Once you’ve figured out how you’re going to use the loan, take the time to figure out what amount would cover that financial need. Going back to the commercial real estate example, you could begin looking at properties online comparable to what you’d like to purchase to get an idea of the market values in your area. If your loan is going to be used to purchase equipment, shop around, get bids and quotes, and have an idea of the total cost of your purchase.

Not only will this help you prevent unnecessary debt, but it can also help whittle down the number of lenders you’re considering. If your loan needs are $500,000, a lender that has maximum borrowing limits of $100,000 can be crossed off of your list.

Do I Meet All Borrower Requirements?

Before you apply for a loan, make yourself familiar with the lender’s borrowing requirements. Time in business, annual revenue, and credit scores are factors considered by most lenders. If you don’t meet the requirements of the lender, you won’t qualify for a loan.

Most lenders perform a soft credit pull when prequalifying you for a loan. A hard credit pull — the kind that shows up on your credit report — is performed further along in the process for most financial products. However, some lenders do perform a hard pull once you hit “Submit” on your application. Avoid an unnecessary inquiry by ensuring that you meet all credit requirements. Before you apply, make sure to check your free credit score online.

Remember, there are many financing options available to business owners, regardless of credit score, time in business, or revenues. Take the time to find the loans that you’re qualified to receive.

Does The Lender Offer Rates & Terms That Work For My Business?

When you select your lender, you want to work with one that will offer you the best rates and terms for your particular situation. A short-term loan that’s funded almost immediately may seem appealing, but a high overall cost of borrowing could put a burden on your business. If you have a solid credit score and a healthy business profile, you should be able to shop around to find rates and terms that are most affordable for you.

If you have credit challenges, there are options available for you. However, there are some drawbacks to these high-risk financial products, like high interest rates and fees or daily payment requirements. If you don’t need the money immediately, you can take steps to boost your credit score so you can apply for a more affordable loan in the future.

What You’ll Need To Apply For A Wholesale Distribution Loan

You’ve decided what type of loan best fits your needs, and you’ve calculated how much you need and can afford. You’ve selected a lender. Now, it’s time to begin the application process. Before you start, there are a few key items the lender will require to approve and fund your loan.

For all loans, you’ll be required to provide basic information about yourself and your business. This includes the name of your business, contact information, your social security number, and your federal tax ID. For some loans, such as business credit cards, this may be the only information you need.

For other loan options, you’ll be required to submit documentation. This documentation will allow the lender to see how your business is performing and if you’ll be able to afford a loan. Documentation requirements vary by lender, but commonly requested documents include:

  • Business & Personal Credit Reports/Score
  • Business & Personal Bank Statements
  • Business & Personal Tax Returns
  • Profit & Loss Statements
  • Balance Sheets
  • Income Statements
  • Business Licenses

If you’re a new business, you may be required to submit the resumes of all business owners, a detailed business plan, and financial projections. If your loan requires collateral, you’ll submit information about the collateral you’re putting up to back the loan. If no collateral is required, you may still be required to sign a personal guarantee or agree to a blanket lien before receiving your loan. Learn more about business loan requirements.

Application, underwriting, approval, and funding times vary based on the type of loan you’re trying to receive. SBA loans take at least several weeks, while lines of credit and business credit cards may be approved on the spot. During the application process, your lender may need to speak with you to ask questions about information and documentation you’ve submitted or to request additional information. Make sure your lender has current contact information on file and that you make yourself available for calls or emails as needed to continue moving through the loan process.

Final Thoughts

Running a distribution business takes organization, hard work, and capital. As a business owner, it’s your job to bring these things to the table, but it’s understandable when money becomes an issue. A business loan can be an excellent resource to keep operations running smoothly or to grow your business provided you do your planning, shop around for the best rates, and understand what your business can afford.

What’s Next
    • Check out the top 8 small business startup loan options
    • Business loan options that don’t require a credit check
    • Your guide to low-cost SBA loans

The post Business Loans And Other Financing Options For Wholesale Distribution Companies appeared first on Merchant Maverick.

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Business Loans For Auto Repair Shops

Cars may be starting to look more like computers, but they still won’t stay on the road long without the help of a trusty local auto repair shop.

If you’re in the auto repair business, you know that the volume of work — as well as the types of problems you’ll encounter — can vary greatly by the day. Even the most prepared shop may run into emergencies where funds aren’t readily available. When that happens, you may need a quick loan to keep things running smoothly. Or you may just need a traditional loan for a large, planned expense.

No matter your need, navigating through the vast market of traditional and alternative lenders can be daunting. Read on and we’ll walk you through how to get business loans for auto repair shops.

Financing Need Best Loan Type Recommended Lender
Purchasing Equipment Equipment Financing Lendio
Supplies and Inventory Short-term Loans PayPal LoanBuilder
Working Capital Lines of Credit OnDeck
Marketing and Advertising Business Credit Card Chase Ink Business Preferred
Business Startup/Expansion/Remodeling SBA Loan SmartBiz

Loan For Equipment Purchasing

We’re not talking parts for your customers’ vehicles. A loan of this type can help you buy the bigger stuff you’ll be keeping in-house and using regularly — things like air compressors, vehicles lifts, brake lathes, and engine hoists.

In most cases, you won’t be purchasing heavy equipment on the fly; you’ll purchase it when you’re first opening your shop, or you’ll have a general idea of when an old piece of equipment needs to be replaced. In these cases, you’re probably less concerned about speed than you are about getting a good deal that fits the needs of your shop.

Equipment Loans

If you prefer to own your equipment, you may want to look into equipment loans. These resemble traditional installment loans in many ways: they’ll accrue interest over time, you’ll make monthly payments, etc. But these loans have a built-in advantage; the equipment you’re purchasing with them can serve as collateral. Collateral is an asset the borrower puts up as security when they take on debt. Secured loans generally have better rates and terms than comparable unsecured loans.

Traditionally, equipment loans cover around 85 percent of the equipment’s costs, but some lenders may cover the entire cost. In most cases, this does not include transportation costs.

Equipment Leases

These are not loans strictly speaking, but they are a popular way to finance heavy equipment. (Read more about equipment loans vs equipment leases.) Leases fall into two broad categories.

Capital leases are essentially an alternative way to buy your equipment. In most cases, you are considered the owner of the equipment under this type of lease. You’ll make monthly payments for the length of the lease, at the end of which you’ll pay a small residual (sometimes as low as $1) to close your account.

Operating leases are closer to the traditional definition of a lease. In this case, you’ll effectively “rent” the equipment over the course of the lease, making monthly payments. At the end, however, you’ll have the option to return the equipment or buy it at fair market value. This type of lease is useful for equipment that becomes obsolete quickly.

Recommended Option: Lendio

If you’re not working with a captive lessor or your preferred bank, it’s nice to be able to hit a bunch of potential equipment financers with one easy application. Lendio is a great way to do just that. Within 72 hours of your application, you should have multiple equipment financing offers on your screen. Funds are typically dispensed within a week of accepting an offer.

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Loans For Supplies & Inventory

You never want to be in a position where your auto body shop is suffering from too much business. Whether you’re facing a very high volume of customers, or an unusual number of customers all presenting with similar car problems, you may find your supplies depleted more quickly than you can collect on your invoices.

When this happens, you may want to consider a short-term loan.

Short-term Loans

Fast, streamlined, and (relatively) expensive, short-term loans are handy when you need a loan fast and want to pay it back quickly.

Short-term loans can usually get money into your hands within a day or two, which makes them a good choice for unplanned emergency financing. Rather than charge interest, short-term loans use a flat fee formula, or factor rate, to calculate the amount of money you’ll owe. For example, if you take out $10,000 at a 1.2 factor rate, you’ll need to pay back $12,000.

Short-term loans usually have terms shorter than a year, so their repayment schedule is much faster than those of medium and long-term loans. If you take out a short-term loan, you’ll be making weekly or daily payments, which, in most cases, will be automatically deducted from your business account.

Recommended Options: PayPal LoanBuilder

Because short-term loans are so fast and volatile, you’ll want some flexibility over the terms of your loan. PayPal’s LoanBuilder product is built around the idea of customization. You’ll be able to customize many elements of your loan to fit your need. Better yet, their rates are reasonable (as short-term loans go).

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Loans For Working Capital

merchant cash advance industry

Working capital is a wonky term for the money you have on hand for daily operational expenses. If everything’s going well, you probably don’t have to give it a lot of thought. But if emergency expenses have tapped into your reserves, you may find yourself unable to pay some small, recurring expense.

Working capital loans tend to be some of the most flexible when it comes to what you can spend your money on.

Lines Of Credit

Since working capital expenses come in many different forms and amounts, it’s nice to have a flexible financial cushion to fall back on. Rather than giving you a lump sum, a business line of credit pre-approves you for a certain amount of money, called your credit limit. While your account is active, you can draw on your credit line as much or as little as you want so long as the total amount you’ve borrowed doesn’t exceed your credit limit.

In most cases, you’ll only pay interest on the amount of money you’ve borrowed, though some lenders do charge administrative and access fees. Revolving credit lines let you reuse credit after you pay off your balance, similar to a credit card. Non-revolving lines of credit don’t have this feature and tend to be extended for specific expenses where the final cost is uncertain.

OnDeck

OnDeck offers quick and easy access to lines of credit, even for businesses with fairly poor credit. Depending on your revenue and other qualifications, you can get a credit limit between $6K and $100K with no draw fee. Just be aware that these are short-term credit lines lasting only about 6 months, but considering the approval process only takes a few days, you don’t need to plan too far ahead. The major downside is the $20/mo administrative fee, but OnDeck will waive that if you withdraw at least $5,000 within the first five days of opening your account.

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Loans For Marketing & Advertising

Word of mouth may be the ideal form of advertising, but sometimes you need to reach outside of your normal sphere of influence to draw in new customers. Or maybe you’re a new business that needs to establish a customer base.

Designing and running an effective advertising campaign is outside of the purview of this article, but most of the good ones require spending some money.

Business Credit Cards

Surprised? Business credit cards are often suggested as a way to smooth out your business’s cash flow, but they also have some other features that make them ideal for certain types of expenses. Namely, rewards programs that allow you to get a return on specific expenses — expenses like advertising.

Just be sure to pay off your balance within your business credit card’s grace period, or the cost in interest will exceed your rewards savings.

Recommended Option: Chase Ink Business Preferred

Chase’s Ink Business Preferred credit card is at the top of most business credit card lists, and for a good reason. It offers one of the most lucrative rewards programs out there. Advertising expenses spent on social media sites and search engines earn triple points (as do travel, shipping, and telecom expenses). Those points can be redeemed on travel, on Amazon, as gift cards, statement credit, or cash back.

The card has an annual fee of $95 and an APR between 17.99% and 22.99%.

Chase Ink Business Preferred



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Annual Fee:


$95

 

Purchase APR:


17.99% – 22.99%, Variable

Loans For Business Startups, Remodeling, Or Expansion

Like equipment purchases, business remodeling and expansion (or starting your business up in the first place) falls under the category of “large, planned expenses.” One of the bigger and more daunting business expenses occurs when you’ve outgrown your space.

If you need additional bays, or even a larger overflow lot, you’ll want a loan that can offer you a large sum of money at a low interest rate. Your best bet is probably an SBA loan.

SBA Loans

The Small Business Administration (SBA) is a government agency tasked with advising and assisting small businesses. The SBA doesn’t usually directly lend to businesses. Instead, it guarantees a portion of an SBA-approved lender’s loan. This guarantee allows you to access better rates and terms than your credit rating or business size might otherwise allow.

The two most common forms of SBA loan are the SBA 7(a) and the SBA 504.

SBA 7(a) Loans SBA 504 Loans
  • Working capital
  • Commercial real estate purchasing
  • Equipment purchasing
  • Purchasing a pre-existing business
  • Refinancing debt
  • Purchase an existing building
  • Purchase land and land improvements
  • Construct new facilities
  • Renovate existing facilities
  • Purchase machinery and equipment for long-term use
  • Refinance debt in connection with renovating facilities or equipment

The 7(a) offers the most flexibility in terms of what it can be used for. This can include anything from equipment to non-investment real estate, leasehold improvements, business acquisition, or start-up costs. Depending on your needs, however, you may want to look into the SBA 504 loan, which has a higher maximum borrowing amount. These loans can be used to purchase land and buildings, buy long-term equipment, or make improvements to your lot.

Be prepared to play the long game with an SBA loan, though. They take far longer to close than the other financial products we’ve discussed.

Recommended Option: SmartBiz

You have a lot of choices when it comes to SBA-approved lenders, which likely includes your preferred local bank or credit union. You don’t need our advice for that, right?

But if you need help navigating the complexity of the SBA application process and don’t have a lender specifically in mind, you may want to give SmartBiz a look. SmartBiz can’t do a full end-run around the massive amounts of paperwork required to get an SBA loan, but what they can do is keep the process as organized and streamlined as possible on your behalf. Most importantly, they’ll match you with a lender that fits your needs.

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What To Consider When Choosing A Lender

If you didn’t see a lender you liked above, you can always hunt for one on your own. Though it can be a time-intensive task, there are some ways to strategically narrow your search.

Why Do I Need A Loan?

Lenders serve a variety of needs, but not every lender can serve yours. Even if you don’t like the lenders we recommended, the type of financial products discussed above can be a guide for finding a lender.

A slow, traditional lender may not be able to help you get emergency funds, while a fast, expensive alternative lender may be a poor choice for financing an expensive renovation.

Am I Qualified?

One of the easiest ways to rule out a lender is to figure out if they’ll rule you out.

Most lenders have minimum qualifications for borrowers. The most common ones are:

  • Time In business: Lenders want to know you’ll be around long enough to pay them back.
  • Credit Rating: Some lenders use credit rating as a line in the sand, while others use it mainly to help determine rates.
  • Revenue: Lenders want to make sure you can pay off your debt. Sometimes this number is an absolute minimum (like $100,000/yr); other times it’s relative to the amount of money you want to borrow ($1.50 for every $1).

Additional factors may include the number of other loans you currently have, the industry or state you’re in, and whether you’ve had any recent bankruptcies.

Do The Terms & Rates Meet My Needs?

While it might seem that lenders have the upper hand, remember that you are ultimately the one who gets to decide whether or not the transaction happens.

If a lender charges usurious rates, if they pile on unnecessary fees, or if they demand repayment on a schedule you can’t accommodate, you’ll probably want to keep looking.

Try to get a sense of whether your prospective lender will be a flexible partner or a predatory animal looking to cash-in on any small mistake you make. Do they offer early payment incentives? Incentives for repeat business? Is customer service available and helpful?

Final Thoughts

When it comes to keeping your auto repair shop’s engines purring, you have a ton of potential financial solutions at your disposal. With a little patience, you can find a deal that fits your needs.

Didn’t find a lender you were looking for above? Here are some overviews of our contenders for loans, lines of credit, credit cards, and startup financing.

The post Business Loans For Auto Repair Shops appeared first on Merchant Maverick.

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Shopify VS Squarespace

Shopify VS Squarespace

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Right away, Shopify and Squarespace both score points in my book for their names. Shopify is all about helping you build an online store where customers can shop — “shop-ify-ing” a regular website, as it were. Squarespace, by comparison, is a more traditional website builder, allowing you to create a literal “square space” (or series of square spaces) where people can view your content and images on the internet.

Thank you, Shopify and Squarespace. Your names actually make sense.

Indeed, Shopify is a household name in the world of shopping cart software, whereas Squarespace is well-known for its attractive and modern site design capabilities. Squarespace is more than just a pretty face, though. In the last few years, this platform has added ecommerce functionality at a surprising level of sophistication.

If you’re here for an epic cage match between Squarespace and Shopify, I’m guessing you’re thinking about both of these platforms in terms of ecommerce. You’re in luck, because this is the precise focus of our comparison. How does Squarespace’s ecommerce functionality and design measure up to the ecommerce powerhouse that is Shopify? How do they compare in terms of pricing, customer service, and payment processing? Keep reading for our take on these and other key facets of Shopify and Squarespace.

Don’t have time to read an entire article? Take a look at our top-rated eCommerce solutions for a few quick recommendations. Every option we present here offers excellent customer support, superb web templates, and easy-to-use software, all for a reasonable price.

 

Pricing

Winner: Squarespace

Both Shopify and Squarespace offer free 14-day trials with no credit card required, and neither charge setup or cancellation fees. From there, the two platforms begin to diverge. Here’s how the differences play out:

Shopify

  • Price Range: Choose from $29/month (Basic), $79/month (Shopify), or $299/month (Advanced) plans. There’s also a $9/month plan (Lite) for selling in-person, for embedding little “buy” buttons on other sites, and for selling on Facebook — but you don’t get an actual online store at all, so we’re leaving this plan out of our comparison for the most part.
  • Annual Subscription Discount: Save 10% when your subscription is paid annually upfront, or 20% if you pony up for two full years. For example, the Basic Plan becomes $26 or $23/month, and the Shopify Plan becomes $71 or $63/month.
  • Subscription Structure: All Basic ($29/month) plans and above include unlimited storage, products, and bandwidth. Higher subscription levels add a few features and additional staff accounts. Subscription levels also affect your Shopify transaction fees and your payment processing fees. Which leads us to…
  • Additional Transaction Fees: If you choose Shopify Payments (powered by Stripe) as your payment gateway, you are not charged any separate transaction fees. As an added bonus, you also see a gradual decrease in your payment processing fees with Shopify Payments as you climb the subscription ladder. However, if you use an alternative payment processor and not Shopify Payments, Shopify does charge extra transaction fees, beginning at 2.0% on the Basic plan. Thankfully, these fees gradually decrease to 1.0% and 0.5% as you increase your subscription.

Squarespace

  • Price Range: For ecommerce capability, you must skip over the $16/month plan and start at the $26/month (Business) level. However, merchants who’d really want to take advantage of Squarespace’s ecommerce features in a manner that’s comparable to Shopify are likely opting for the $30/month (Commerce Basic) or $46/month (Commerce Advanced) plans.
  • Annual Subscription Discount: The Business plan drops to $18, Commerce Basic to $26, and Commerce Advanced to $40 per month when paid upfront in one annual lump sum. You also qualify for a free domain registration for one year when you pay your main subscription annually.
  • Subscription Structure: Similar to Shopify, features are added as you increase your Squarespace subscription level. Bumping up to Commerce Basic or Advanced will eliminate separate Squarespace transaction fees.
  • Additional Transaction Fees: A 3.0% fee (above your gateway fees) is incurred by Squarespace on every purchase if you’re on the Business Plan. This additional transaction fee is eliminated, however, on Commerce Basic and Advanced.

For a direct comparison with Shopify, use the smaller print, month-to-month figures for Squarespace (Commerce Basic $30 and Commerce Advanced $46). Shopify promotes month-to-month figures ($29, $79, or $299).

Confusing enough for you? With all these pricing components, you can’t actually perform a true apples-to-apples comparison of cost. In truth, both Shopify and Squarespace offer a fair market price for their services. I will say that the transaction fee issue is problematic with both companies, especially since many competing platforms have eliminated these extra charges altogether. The good news is that each platform at least offers some way out of these fees.

In the end, I’m primarily basing my pricing verdict on one key factor: Squarespace offers its complete arsenal of features for only $46/month ($40/month if paid annually). In contrast, Shopify reserves its premium features for sellers with much deeper pockets (six and a half times deeper, to be exact). The big question is: does Squarespace offer enough ecommerce features at that $46/month level? The answer will depend on your business needs, but you can keep reading to develop a clearer picture of each platform.

Cloud-Based Or Locally-Installed

Winner: Tie

Your Shopify or Squarespace store will be fully-hosted. No need to download and install either one locally.

Specific Size Of Business

Winner: Shopify

Both platforms allow unlimited bandwidth and products, but Shopify is better at accommodating a wider range of business sizes and product catalogs. In addition, Shopify provides a natural growth option via Shopify Plus, whereas Squarespace offers no enterprise-level plan at this time. On the other hand, if you happen to sell a handful of very expensive products (and that’s what makes your business “big”), Squarespace could still work swimmingly for you.

Hardware & Software Requirements

Winner: Tie

Since Squarespace and Shopify are both SaaS (Software as a Service) platforms, you only need a computer, an internet connection, and an up-to-date browser to use either service. Both also provide Android and iOS apps for managing and editing your store.

Regarding supported browsers, Squarespace edges out Shopify by offering Chrome and Safari support on Linux operating systems, while Shopify only works with Windows and Mac. Meanwhile, Shopify stores are optimized for Samsung Internet in addition to Chrome and Safari browsers when viewed on mobile. Depending on your point of view, these finer points may or may not make a difference, so I’m still calling it a draw in this category.

Ease Of Use

Winner: Shopify

With both platforms specializing in general ease of use, we really need to examine Squarespace and Shopify in terms of usability for ecommerce.

Neither platform has a dedicated setup tutorial inside the dashboard, but both have documentation and instructional videos handy. If you’re accustomed to using or testing popular ecommerce platforms like Shopify, Squarespace will definitely have its own learning curve. Once I got the hang of it, though, I could operate the backend quite smoothly.

When you create a trial account with Shopify, you’re taken to the main admin panel. Shopify’s admin is structured like most ecommerce dashboards I’ve seen. Although you can preview your storefront at any time, your backend functions are kept separate from the storefront.

Shopify Dashboard:

With Squarespace, however, you must choose a theme (you can change it later) before you even get to see your admin panel. Once the admin opens, your dashboard is actually a combination of your backend control panel on the left, and your storefront preview on the right.

Squarespace Dashboard:

Although I can vouch that both platforms are very easy to use in the grand scheme, I find navigation of Squarespace’s backend to be slightly trickier than Shopify’s. The Squarespace UI is structured so that there are more dashboard layers to dig through — and then dig back out of again. Additionally, the left control panel menu changes (or even disappears) depending on what layer you happen to be in at the moment, which can be disorienting. This is in contrast to Shopify’s menu, which remains a fixed anchor point for admin navigation.

Take a quick look at the following screens from each platform to see what I mean:

Add A Product — Shopify:

You can see above that my main menu remains fixed on the left side of the dashboard as I enter my product details.

Add A Product — Squarespace:

With Squarespace, I’m already a couple of dashboard layers in, my left sidebar is gone, and I must dive one more screen deep from here to even enter my price. Also, what is not shown above is that you can’t just jump right in and start adding products with Squarespace like you can with Shopify and other online store builders. Even with Squarespace’s ecommerce-friendly templates, you must create a separate product page for your website first. I admit I had to resort to Squarespace’s documentation to figure this out, since I’m accustomed to ecommerce dashboards that make adding your first product a completely frictionless process.

Adding and managing inventory is just one piece of running an online store, but it remains a reliable ease of use test case. While you can list unlimited products with Squarespace, I think the backend interface is better designed for sellers offering a relatively small number of aesthetically-oriented products. Merchants with a large inventory will appreciate Shopify’s clear menus, efficient navigation, and the way in which product data is ultimately organized.

Features

Winner: Shopify

Shopify is the deserving winner in the features category. With solid out-of-the-box functionality and a rich add-on ecosystem, the blunt truth is that Shopify has spent much more time and resources cultivating features specifically for online sellers.

That said, there are a few features Squarespace offers that even Shopify lacks. Another thing to keep in mind is that Squarespace’s comparatively small feature set may still be just right for certain sizes and types of companies.

Key features of both platforms include:

  • Unlimited products, bandwidth, and storage
  • Free SSL certificate
  • Sell physical or digital products
  • Shipping & accounting integrations
  • Inventory & order management
  • Offer gift cards
  • Create discounts and coupons
  • Checkout on your domain
  • Abandoned cart recovery
  • Guest checkout & customer accounts
  • Real-time, carrier-calculated shipping
  • Analytics & reports
  • SEO tools

I’d say the Shopify versions of some of the above features are stronger or more versatile than the Squarespace versions. For example, the discount engine is much more flexible with Shopify.

Now, here are a few features that differentiate the two platforms:

Shopify

  • App store with thousands of integrations
  • Point of sale integration (Shopify POS or third-party POS)
  • Manual order creation (virtual terminal)
  • Proprietary shipping platform (Shopify Shipping) for carrier discounts and label printing
  • Extensive dropshipping capability
  • Enterprise expansion available via Shopify Plus
  • Abandoned cart recovery at cheaper plan level

Squarespace

  • Unlimited staff contributors on all ecommerce plans
  • G Suite integration (full year free)
  • $100 Google AdWords voucher
  • Free domain for a year if you pay annually
  • Customizable checkout forms
  • In-dashboard product image editing
  • Third-party calculated shipping rates at cheaper plan level

Web Design

Winner: Squarespace

Both platforms offer elegant, modern templates that are fully mobile responsive. Here’s a quick comparison of template stats:

Shopify Themes

  • 67 total templates, most with 2-4 style variations
  • 10 templates are free and supported by Shopify developers
  • Remaining third-party themes cost $140-$180

Squarespace Themes

  • 90 templates organized into 21 template families
  • All templates are free and supported by Squarespace developers

Within these themes, both platforms facilitate the adjustment of fonts, colors, and layouts without any coding experience. In fact, I’d say both services offer more flexibility in this area than the average ecommerce store builder. If you still run into design limitations or simply want to alter the code, each site builder makes it relatively easy to customize your store with HTML, CSS, and Javascript.

The overall web design winner is a tough one to call, because that decision really depends on the type and number of products you intend to sell, with Squarespace catering to smaller catalogs with visual interest. If we were deciding strictly based on the variety of pre-made templates designed for stores selling lots of stuff, Shopify would snag the win.

That said, here are some ways Squarespace stands out when it comes to design:

  • All templates are free, and all are created and supported by Squarespace.
  • Offers a more versatile drag-and-drop editor for page layout customization.
  • Allows you to edit your product images from within your dashboard.
  • Uses a common templating language (JSON), versus Shopify’s own invented language (Liquid).

Was this category too close to call? Share your thoughts in the comments!

Integrations & Add-Ons

Winner: Shopify

Shopify has an impressive app store with around 2500 integrations — more than the vast majority of SaaS ecommerce platforms at large. While add-ons can certainly increase your monthly expenditure with Shopify, there’s no denying that your choices are plentiful. Plus, since a huge community of developers and merchants interact with Shopify apps, you also have access to thousands upon thousands of detailed user reviews.

Squarespace takes a completely different approach to integrations. No app store is offered, but Squarespace spins this as an advantage. Any pre-built integrations (about 70 in total) are already incorporated into your dashboard and fully tech-supported by Squarespace. Aside from payment providers (Stripe, PayPal, Apple Pay) and shipping carriers (UPS, USPS, and FedEx), there are just a small handful of official Squarespace integrations specifically related to ecommerce. Here are a few key add-ons:

  • ShipStation: Order fulfillment
  • Xero: Accounting
  • MailChimp: Email marketing
  • Zapier: Workflow automation, multi-app connector

Just like many Shopify apps, several Squarespace apps have monthly subscription fees of their own. And, just like with Shopify, you can always build custom integrations if you have those skills or can hire someone who does. To put things in quick perspective, however, Squarespace has one official shipping/fulfillment app in ShipStation. Shopify has over 280 choices in its “Orders & Shipping” category, and over 600 results pop up if I simply type “shipping” in the app store’s search bar.

The win in this category goes to Shopify, the reigning monarch of ecommerce integrations. Besides keeping decision-making overload at bay, the trick with Shopify add-ons is to always check the quality (including quality of developer support) and ongoing cost of each integration.

Payment Processing

Winner: Shopify

Shopify wins at payment processing for one primary reason: flexibility. Consider the sheer number of gateway options with Shopify — over 100. With Squarespace, Stripe and PayPal are your only choices. More gateway options means availability in more countries and currencies, more ways for your customers to pay, better odds of finding the perfect processor for your specific needs, and even the opportunity to customize your own pricing model and rates in some cases. With Shopify, you can also accept cryptocurrencies or set up manual payment methods like cash on delivery, money orders, and bank transfers.

This is not the end of the story, however. Factor in the additional transaction fees that may be charged by either platform depending on your situation, as well as Shopify’s payment processing discounts with Shopify Payments (powered by Stripe), and the comparison becomes more nuanced.

As we examine these complications further, keep in mind that the going rate to process ecommerce transactions with most gateways these days is 2.9% + $0.30.

Here’s how your processing will work with Squarespace according to your subscription level:

Squarespace + PayPal and/or Stripe

  • Business ($26/mo.): 2.9% + $0.30, + 3.0% Squarespace fee = 5.9% + $0.30 per transaction
  • Commerce Basic ($30/mo.): 2.9% + $0.30
  • Commerce Advanced ($46/mo.): 2.9% + $0.30

Those are the only potential processing costs you’re looking at with Squarespace. That additional 3.0% Squarespace fee on the Business plan is pretty brutal, but as soon as you upgrade to Commerce Basic for an extra $4/month, it disappears. For this reason, I don’t think the Business plan is a sustainable option for most ecommerce stores.

Now, let’s take a quick look at Shopify, remembering that using Shopify Payments as your gateway provides two perks: 1) no extra Shopify transaction fee on any plan, and 2) decreased payment processing fees as you upgrade your overall Shopify subscription.

Shopify + Shopify Payments

  • Basic ($29/mo.): 2.9% + $0.30
  • Shopify ($79/mo.): 2.6% + $0.30
  • Advanced ($299/mo.): 2.4% + $0.30

Shopify + Alternative Gateway (Generic Example)

  • Basic ($29/mo.): 2.9% + $0.30, + 2.0% Shopify fee = 4.9% + $0.30
  • Shopify ($79/mo.): 2.9% + $0.30, + 1.0% Shopify fee = 3.9% + $0.30
  • Advanced ($299/mo.): 2.9% + 0.30, + 0.5% Shopify fee = 3.4% + $0.30

Another twist is that Shopify Payments is currently only available for businesses located in 10 countries, so you’re stuck with an alternative gateway and that pesky Shopify transaction fee if your country isn’t included. (Squarespace at least doesn’t punish you for something you can’t control — your location.) On the flip side, if you are in one of the supported countries, you could opt to use Shopify Payments in addition to any of the other gateways Shopify offers to increase your customers’ payment options.

In a perfect world, both platforms would let you pick your own processor from among many, and never penalize you with extra transaction fees for any reason! Both Shopify and Squarespace have their own flaws in this regard.

So, what does this all mean for your business? The short answer is math. To determine the real winner in this category for your own company, you must consider your monthly subscription cost to either platform, your average number of transactions per month, and your average transaction size — not to mention the countries and currencies involved. Because the best platform and subscription level for your business depends on these and other factors, I award Shopify the payment processing win for at least making things interesting!

Customer Service & Technical Support

Winner: Shopify

In terms of overall quality of customer support, both Shopify and Squarespace receive mixed user reviews. That said, Merchant Maverick’s own experiences with customer service and technical support would award Shopify the victory in this category. We’ve had better luck contacting the Shopify support team through the available channels — even when they’ve been unaware that we are software reviewers on the prowl.

Shopify also has more available support channels and more open-hours. Take a look:

Shopify

  • Phone: 24/7
  • Email: 24/7
  • Live Chat: 24/7

Squarespace

  • Phone: None
  • Email: 24/7
  • Live Chat: Monday-Friday, 4AM-8PM

Squarespace publishes a whole manifesto on its website explaining why no phone support is offered if you’d like to read it for yourself. Although they don’t come right out and say it, the bottom line is that this helps keep overall costs down. Meanwhile, not being able to contact a live person (even via live chat) after 5pm Pacific time is pretty brutal if you’re running an online store. Squarespace should know better — ecommerce never sleeps:

One final note in this category: both platforms provide several self-help resources — community forums, blogs, video tutorials, webinars, knowledgebase articles, and the like. However, note that Shopify resources are 100% geared toward ecommerce, whereas you’ll have to wade through other topics to find ecommerce resources at the Squarespace site.

Negative Reviews & Complaints

Winner: Squarespace

When comparing user reviews for these platforms, it’s important to keep in mind the difficulty in teasing out feedback on Squarespace that is specifically related to ecommerce. Despite its growing ecommerce capability, Squarespace typically ends up in the generic website builder category on most review sites, with users discussing traditional website building issues.

Those caveats aside, here are some of the most common issues that come up for each platform:

Shopify

  • Extra transaction fees when not using Shopify Payments
  • Costly add-ons
  • Poor customer support
  • Frustration with Shopify Payments

Squarespace

  • Glitches & bugs
  • Poor/limited customer support
  • Limited theme customization

Of course, traditional website builders tend to get raked over the coals for the slightest theme customization limitations. We’ve already said Squarespace’s design capability is quite good overall, particularly when compared to a lot of shopping cart builders. When customers do criticize Squarespace specifically on ecommerce, there are no consistent patterns emerging so far. For this reason, I award this category to Squarespace based on a “no news is good news” argument. We’ll keep checking back for patterns.

Positive Reviews & Testimonials

Winner: Tie

Both Shopify and Squarespace tend to rate highly for overall customer satisfaction on user review websites. On top of that, both platforms are known for their ease of use and elegant templates. And, along with all the negative review of customer support both software programs have received, users of both platforms have been known to also sing praises for customer support. The combination of these factors led me to call this one a draw.

Once again, we’re faced with the dilemma that there’s not a whole lot of feedback about Squarespace’s ecommerce offerings. I have definitely seen several generic comments, such as “good for ecommerce!” Honestly, I think people are mostly pleased (and perhaps a bit surprised) that there’s some solid ecommerce capability available with Squarespace at all. I haven’t come across many users directly comparing their experiences with the two platforms.

Security

Winner: Shopify

Our combatants are quite close in this category. Both offer PCI (Payment Card Industry) compliance, a free SSL (Secure Socket Layer) certificate for your site, two-factor authentication for logging in to your account, a CDN (Content Delivery Network), and even provide methods for complying with the GDPR (General Data Protection Regulation) laws implemented by the EU in 2018.

The main difference I can see is that Shopify’s checkout pages are covered by an industry-standard, 256-bit shared SSL certificate. Squarespace’s checkout pages are covered by a less-robust, 128-bit certificate. My understanding is that while 128-bit encryption may end up working slightly faster, it’s technically less secure.

Final Verdict

Winner: Shopify

Squarespace put up a good fight in several categories, but Shopify emerges victorious as the better ecommerce website builder. Shopify’s pricing, core feature set, and vast app store can serve budding sellers on the Lite plan, all the way up to enterprise clients using Shopify Plus. Meanwhile, ecommerce was quite literally an afterthought for Squarespace. The platform’s developers have done an admirable job adding features for online selling, but they just can’t compete with Shopify’s dominance here.

As we’ve said time and again in this comparison, Squarespace still provides an interesting option for sellers who’d like to feature a small number of products with aesthetic appeal. Especially if you’ve already been using Squarespace to develop your company story and brand, I’d definitely recommend fully exploring the ecommerce feature set — perhaps by bumping up your subscription for just month or two — before completely abandoning ship for Shopify or another dedicated shopping cart builder.

I’ll offer one more interesting twist before you head off to test Shopify and/or Squarespace for yourself. Some users have actually used the two services in combination. How? By integrating those “buy now” buttons from a $9/month Shopify Lite plan into an existing Squarespace website. It’s a roundabout option, to be sure, but it also gives you access to in-person selling with the Shopify POS app. At any rate, take that as some final food for thought, and best of luck in your search for the perfect ecommerce platform.

The post Shopify VS Squarespace appeared first on Merchant Maverick.

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Retail Business Loans And Financing Options

Owning a retail business isn’t without its challenges. Whether you’re growing rapidly and need extra money for expansion or you’re in the middle of a slow season that’s impacted your cash flow, one thing is clear: you need money for your business to operate smoothly.

Sure, pulling the money you need from your own bank account is ideal, but this isn’t always possible. Maybe the money’s not there … or maybe you don’t want to put yourself in a bind by tying up your funds. In these situations, what do you do when you need a financial helping hand? Take a cue from other smart retailers and find a retail business loan that’s right for you.

There comes a time when most small businesses have to take out a loan, and retail businesses are no exception. The key is to understand your options to find the best, most affordable loan that you can use to take your store to the next level, cover an unexpected emergency, or even get your business off the ground. Read on to learn more about the retail business loan and financing options available for any situation.

The Best Loans For Retail Businesses

Financing Need Best Loan Type Recommended Lender
Business Expansion SBA Loan SmartBiz
Purchasing Equipment Equipment Financing Lendio
Emergency Funding Short-Term Loan LoanBuilder & IOU Financial
Cash Flow Shortages Business Credit Cards Ink Business Preferred from Chase
Purchasing Inventory Line of Credit OnDeck
Purchasing a Point of Sale System POS Financing CDGcommerce

1. Business Expansion

Business is booming, and you’re ready for an expansion. Maybe you’re an online retailer and you’ve decided it’s time to open your first brick-and-mortar store. Perhaps you want to open an additional location, or you want to do a complete overhaul of your facilities. No matter what the situation, your retail business is growing, which is exciting … but also very expensive.

Instead of hindering your growth by draining your checking account, consider applying for a loan that provides the funds you need, but spread out into affordable monthly payments.

Small Business Administration 7(a) Loans

The Small Business Administration is a government organization that provides resources to small business owners just like you. One of the most popular resources the SBA offers small business owners is low-cost loan options. Although there are several great programs to consider, the SBA 7(a) loan is one of the most popular among small business owners.

The SBA 7(a) loan is a loan that can be used for essentially any business purpose. This includes business expansion, the purchase of equipment, to use as working capital, or to even save money by paying off high-interest debt.

Through the 7(a) program, you can receive up to $5 million. Because up to 85% of the loan proceeds are backed by the government, SBA-approved lenders (known as intermediaries) are more willing to give these loans out. This is ideal if you’ve been unable to qualify for traditional loan options.

SBA 7(a) loans have low interest rates capped at a maximum of 4.75% — added to the prime rate — based on the loan amount and your repayment terms. Repayment terms are available up to 10 years for most uses, while loan proceeds being used for commercial real estate come with maximum terms of 25 years. SBA 7(a) loans are available to qualified borrowers with a credit score in the high 600s.

Recommended Option: SmartBiz

The SBA 7(a) loan sounds pretty great, doesn’t it? If you’re interested in this loan, you could visit an intermediary lender in your area, such as a bank or credit union. However, this process can often be a hassle for the busy retail business owner. Simplify the process of applying for an SBA 7(a) loan by working with SmartBiz.

With SmartBiz, you can fill out an easy online questionnaire to find out if you’re qualified for an SBA loan. Once you’re prequalified, the service will match you with a lender and assign a relationship manager to help you through the application process.

Getting approved and funded takes several weeks for most applicants. Other times, the process may drag out over several months if more information is needed by your lender. Even though the waiting time to receive this type of loan exceeds that of other financing options, the low overall cost and the flexibility that comes with the 7(a) loan is often worth the wait for many small business owners.

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2. Purchasing Equipment

Your technology and equipment are seriously outdated. Or maybe your business is growing so fast that your problem is not replacing equipment, but adding more. Instead of spending thousands out of pocket, there’s a more affordable solution when you need to replace or purchase long-term equipment: equipment financing.

Equipment Financing

Equipment financing is a type of business financing used to purchase new equipment for your business. With equipment financing, you’ll be able to take possession of much-needed new equipment immediately without paying the entire cost up front.

With an equipment loan, you’ll pay a down payment that is usually 10% to 20% of the total cost of the equipment. The remaining amount, along with interest and fees charged by the lender, will be loaned to you and is paid back through scheduled payments over a longer period of time. At the end of your repayment period, you will own the equipment. This makes the purchase of new or replacement equipment much more affordable.

Equipment leases are another form of equipment financing. With equipment leasing, you’re essentially paying to use the equipment. At the end of your lease, you can return the equipment and take out another lease on the latest model. Unlike a loan, you will never own the equipment unless you pay a lump sum at the end of the lease. However, if you upgrade equipment frequently or want a lower down payment, a lease may be the right option for you.

Recommended Option: Lendio

If equipment financing sounds like the right loan option for your business, find a lender using Lendio. Lendio is a loan-matching service that connects you with the right lender that offers loans to best fit your needs.

Equipment financing through Lendio lenders is available in amounts from $5,000 up to $5 million. Terms of up to 5 years are available. Interest rates for the most qualified buyers start at 7.5%.

Column Heading Data

Credit limit:

$5,000 – $5,000,000

Term length:

1 – 5 years

Interest rate:

7.5%+

Origination fee:

By lender

Collateral:

Usually the equipment being financed

When using Lendio, you’ll fill out an application and within 72 hours, you’ll receive loan offers from multiple lenders. This allows you to review your options to find the most affordable loan with the best repayment terms.

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3. Emergency Funding

Even if you’re on top of your business and finances, there may come a time when an unexpected emergency arises. It happens to the best of us, usually when we are least prepared for it. If an emergency pops up and you need extra cash immediately, a short-term loan could offer just what you’re looking for.

Short-Term Loans

A short-term loan is exactly what the name suggests: a loan that comes with short terms of 1 year or less. These loans have their benefits for small business owners. Borrowers with low credit scores, a short time in business, or with low annual revenues often qualify. However, the biggest benefit is how quickly you can receive the money with a short-term loan. With some lenders, you can apply, be approved, and have the money in your bank account in just 24 hours.

However, short-term loans don’t come without their drawbacks. This fast form of financing comes at a cost. Short-term loans do not have interest rates, but instead, use something called a factor rate. This fee is paid back along with the principal balance over a short period of time. Often, this factor fee, along with other costs such as origination fees, can make these loans more expensive than long-term options. However, when you’re in a financial bind and need money quickly to keep your retail business running smoothly, a short-term loan may be your best option.

Recommended Options: PayPal LoanBuilder & IOU Financial

PayPal’s LoanBuilder provides short-term funding up to $500,000, which can be repaid over a period of 13 to 52 weeks based on the amount of the loan received. The LoanBuilder application takes just 10 minutes to complete. Once approved, you can receive your funds as soon as the next business day.

Qualified borrowers must be in business for 9 months and have at least $42,000 in annual revenue. All borrowers must have a minimum credit score of 550.

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Another short-term loan option is IOU Financial. This lender offers loans up to $300,000. Requirements include being in business for a minimum of one year, bringing in revenue of at least $100,000, and making at least 10 deposits per month into your business bank account.

Repayment terms are available from 6 to 18 months, and once your loan is 40% paid off, you can renew if additional funding is needed. Repayments are made through fixed daily or weekly payments.

4. Cash Flow Shortages

From time to time, a retail business may face cash flow shortages due to a slow season or other challenges. When this happens, daily operations may be affected. You have the same expenses, but your revenues are down, posing a financial challenge for your business. You don’t have to sit back and let these situations drag your business down. Instead, a business credit card can help you fill in these gaps.

Business Credit Cards

A business credit card provides you with a revolving line of credit that you can use to pay your suppliers, vendors, and other expenses. The issuer of the credit card will provide you with a credit limit. You can spend up to and including that limit, using the card as often as you need.

A business credit card allows you to make an instant purchase without having to wait for approval from the lender. You’ll only pay interest on the amount of the credit line that has been used. Payments are made monthly and are applied to the interest and the balance on your card.

One great feature about business credit cards is that many offer rewards programs. With qualifying business purchases, you can earn cash back or points that can be redeemed toward rewards.

Recommended Option: Ink Business Preferred from Chase

The Chase Ink Business Preferred credit card is a top choice among retailers and other business owners because of its great rewards program. If you spend $5,000 within three months of opening your account, you receive 80,000 bonus points. For every purchase, you’ll continue to rack up points.

This credit card also offers additional benefits not offered by other credit card issuers, such as cell phone protection. This card comes with a variable APR of 17.99% to 22.99% with a $95 annual fee.

This credit card is reserved for borrowers with good to excellent credit. Check out our other top picks in business credit cards.

Chase Ink Business Preferred



Apply Now 

Annual Fee:


$95

 

Purchase APR:


17.99% – 22.99%, Variable

5. Purchasing Inventory

You need inventory, and you need it now. If you need to purchase inventory to keep your business running and time is of the essence, a business line of credit may be just what you need out of a small business loan.

Line Of Credit

With a line of credit, a lender issues you a credit limit. You can make multiple draws up to and including this limit whenever you want. The funds will typically be in your account within a few business days, although some lenders offer immediate transfers.

Interest is only applied to the portion of the funds that have been withdrawn. Interest rates vary by creditworthiness, with the most qualified borrowers receiving rates around 6% while high-risk borrowers may see rates of 20% or more.

Payments are made on a scheduled basis and are applied toward the principal and interest. Repayment terms and schedules vary by lender.

Recommended Option: OnDeck

OnDeck is an alternative lender that provides lines of credit to business owners. Lines of credit up to $100,000 are available to eligible borrowers. Repayment terms up to 12 months are available. Rates are as low as 13.99%, and weekly payments are automatically deducted from your business bank account.

OnDeck is known for its fast application process and low borrower requirements. Borrowers of this loan must have a credit score of at least 600, have been in business for at least 1 year, and have a minimum revenue of $100,000 per year.

Review

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6. Purchasing A Point Of Sale System

POS hardware

 

If you own a retail business, you already know the importance of a point of sale system. This centralized system allows you to keep track of inventory, receive payments, and provide receipts for purchases.

Whether you’ve opened a new store or you want to upgrade your outdated system, you can receive a new POS system without paying a lot of money up front with POS financing options.

POS Financing

POS financing allows you to purchase or lease a POS system without paying the full amount up front. Depending on the company you work with, full financing options for all hardware and software may be available.

In addition to POS financing, you may also consider a credit card processing app. These are usually more affordable, are less complicated, and don’t require lengthy contracts. This option is best for smaller retail businesses, while larger businesses should stick with a full POS system.

Recommended Option: CDGcommerce

CDGCommerce is a retail credit card processing company that offers affordable point of sale systems. The company offers the Harbortouch Echo featuring the CDG POS+ app that can be rented for just $49.00 per month. An annual equipment insurance fee is also required at a cost of $79.00, but compared to the costs of purchasing a system, these fees are quite affordable.

Ready to upgrade but unsure of which POS is right for you? Read on to learn more about choosing the right retail POS system for your business.

When You Want To Start A Retail Business

All of these options are great for established retail businesses, but what if you haven’t even gotten your business off the ground yet? For most aspiring business owners, financing is the barrier that is holding them back.

It may be difficult to qualify for a startup loan. After all, you don’t have the sales, revenues, and financial documents to back up your success. When you want to start a business, you have to get creative with your funding options.

If you want to apply for a business loan, you can look to options such as the SBA Microloan program, which provides up to $50,000 to small business owners. These low-cost loans aren’t easy to obtain, though. You’ll need to make sure that you’re prepared for the lengthy application process by preparing your personal financial documents, creating a detailed business plan, and outlining future projections. Your score must be in the high 600s to qualify.

SBA 504 Loans

Borrowing Amount

$500 – $50,000

Term Lengths

Up to 6 years

Interest Rates

6.5% – 13%

Borrowing Fees

Possible fees from the loan issuer

Personal Guarantee

Guarantee required from anybody who owns at least 20% of the business

Collateral

Collateral normally required, but depends on the lender

Down Payment

  • No down payment for most businesses
  • Possible 20% down payment for startups
  • Possible 10% down payment for business acquisition loan

Other startup loan options are available, such as online lenders like Fundwise Capital. For borrowers with a poor credit history, there are other alternative loan options but these often come at a much higher cost.

If you have a high personal credit score, you can also consider taking out a personal loan to fund your startup costs. With a personal loan, your income and personal credit score will be considered. This could potentially help you score a lower cost loan that can be used to start your retail business.

Lender Borrowing Amount Term Interest Rate Min. Credit Score Next Steps

$2K – $25K 2 – 4 years 15.49% to 30% 600 Apply Now

$1K – $50K 3 or 5 years 8.16% – 27.99% 620 Apply Now

$2K – $35K 3 or 5 years 6.95% – 35.99% APR 640 Apply Now

lending club logo

$1K – $40K 3 or 5 years 5.32% – 30.99% 640 Compare

Ways To Improve Your Chances Of A Successful Application

Improve Business Loan Application

Once you’re ready to apply for your business loan, you can do some prep work in advance to expedite the process. Before you even start filling out an application, the first step is to know your credit score and determine whether it is high enough to qualify for the loan you’re seeking.

You can receive your free credit score online to find out where you stand. Review your credit report carefully for any errors. If there are any negative items on your report, be prepared to explain those to your lender.

If your credit score is low and your funding need isn’t urgent, you may consider taking a few easy steps to raise your credit score. You’ll be rewarded with lower interest rates, better terms, and more financing options.

You can also prepare your paperwork and documentation in advance. Although requirements vary by lender and the type of loan you’ve selected, you’ll generally need a few items, including:

  • Bank Statements
  • Personal Financial Statements
  • Business Balance Sheet
  • Profit & Loss Statement
  • Income Statements
  • Business Licenses
  • Articles Of Incorporation

When the time comes to apply for your loan, you’ll need to know exactly how much you need and why you need the loan. It’s also important to remember that most loans require a blanket lien or personal guarantee. Most lenders require a personal guarantee to be signed by anyone with at least 20% ownership in the business, so be prepared to have all owners ready to sign the contract as needed.

Finally, when you do apply for your loan, be sure to make yourself available to the lender. Sometimes, lenders require additional documentation or have questions about your application. Taking the time to work with your lender will help you finish the process smoothly.

Final Thoughts

Getting a business loan can be tough, whether you’re an established retail business owner or just getting started. However, there are plenty of options available if you take the time to do your research, go into the application process prepared, and have a good reason for taking out the loan which will improve the return on investment for your business.

The post Retail Business Loans And Financing Options appeared first on Merchant Maverick.

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Best Credit Cards For New Business Owners

If you’re a new business owner, getting a credit card sounds like an awesome idea. Credit cards help you build credit, save you money with rewards, and enable you to make large purchases without needing cash on hand.

But as a new business owner, you may be wary of applying for a credit card because your company lacks credit history. The good news? Many card issuers will take your personal credit history into account. This means that if you’ve maintained a good personal credit score, you have an excellent chance of qualifying for a business credit card. The even better news? There are plenty of options even for those with limited credit history or poor credit scores.

We’ve researched some of best credit card options for new business owners and listed them below. Read on through to determine which one is right for you!

Comparison Of The Best Credit Cards For New Business Owners

Best for Card
Cash back SimplyCash Plus Business Credit Card from American Express
Travel rewards Chase Ink Business PreferredSM
No annual fee Chase Ink Business CashSM
0% introductory rate Blue Business Plus Credit Card from American Express
Fair credit Capital One Spark Classic For Business
Bad credit Wells Fargo Business Secured Credit Card

Best Card For Cash Back Rewards: SimplyCash Plus Business Credit Card from American Express

SimplyCash Plus Business Credit Card from American Express



Compare

Annual Fee:


$0

 

Purchase APR:


14.24% – 21.24%, Variable

Offering up to 5% cash back on some purchases, the SimplyCash Business Credit Card from American Express is hard to beat. It also provides you with some choice when it comes to cash back categories, meaning that you can customize this card to fit your spending habits.

This nifty card gives you 5% back on purchase made at U.S. office supply stores and on wireless telephone services purchased directly from U.S. service providers (up to $50,000 spent per calendar year). You’ll then get to pick one category from the below list of eight options to earn 3% cash back:

  • Airfare purchased directly from airlines
  • Hotel rooms purchased directly from hotels
  • Car rentals purchased from select car rental companies
  • U.S. gas stations
  • U.S. restaurants
  • U.S. purchases for advertising in select media
  • U.S. purchases for shipping
  • U.S. computer hardware, software, and cloud computing purchases made directly from select providers

As with the 5% categories, you’ll earn the 3% cash back up until you spend $50,000 in a calendar year (after which you’ll receive 1% back). All other purchases will net you 1% cash back.

SimplyCash Plus gives you the ability to buy above your credit limit. There is no annual fee, and 0% intro APR for the first nine months.

Need a more detailed breakdown? Visit our full review.

Best Card For Travel Rewards: Chase Ink Business Preferred

Chase Ink Business Preferred



Apply Now 

Annual Fee:


$95

 

Purchase APR:


17.99% – 22.99%, Variable

While this card from Chase is simply a rewards card, it packs in a lot of bonuses for those that travel frequently.

To start, Ink Business Preferred users get three points per dollar spent on travel, shipping purchases, Internet, cable and phone services, and on advertising purchases made with social media sites and search engines each account anniversary year (up to $150,000 spent). All other purchases get one point per dollar spent. You’ll then be able to redeem your points for 25% more when you redeem them for travel through Chase Ultimate Rewards.

Beyond those basic rewards, Chase also lets you transfer your points on a 1:1 basis to nine airline and four hotel reward programs. If you need something other than travel rewards, you’ll also be able to redeem points for Amazon.com purchases, gift cards, and cash back, making this an extremely versatile card.

If you want more information on this card, check out Merchant Maverick’s complete review.

Best Card With No Annual Fee: Chase Ink Business Cash

Chase Ink Business Cash



Apply Now

Annual Fee:


$0

 

Purchase APR:


15.24% – 21.24%, Variable

This card from Chase lets you earn up to 5% cash back when you make purchases at office supply stores and on internet, cable, and phone services (up to the first $25,000 spent). You can also earn 2% back when spending at gas stations and restaurants (up to the first $25,000 spent). Everything else earns you 1% back.

The cherry on top of all those rewards is that you won’t have to worry about paying an annual fee—this means you’ll end up with savings no matter how much you spend yearly.

The Ink Business Cash also features a 0% intro APR rate for the first 12 months, a very generous offer. Chase is currently offering a welcome bonus of $500 cash back when you spend $3,000 within your first three months of opening an account.

If you want all the deets, read our full review.

Best Card With A 0% Introductory Rate: Blue Business Plus Credit Card from American Express

Blue Business Plus Credit Card from American Express



Compare

Annual Fee:


$0

 

Purchase APR:


12.99% – 20.99%, Variable

If you need to make a big purchase but can’t pay it all up front, having a card with 0% APR is very helpful because you won’t accrue interest. With a 0% intro APR for the first 15 months, the Blue Business Plus Credit Card from American Express has one of the longest 0% intro rates.

On top of that generous intro APR period, the Blue Business Plus also packs in some solid rewards. As a base, you’ll earn two points per dollar spent up to $50,000 yearly, and then one point per dollar thereafter.

Amex also grants you expanded buying power, which enables you to spend above your credit limit. Additionally, this card does not carry an annual fee.

Get the full breakdown on the Blue Business Plus with the complete review from Merchant Maverick.

Best Card For Fair Credit: Capital One Spark Classic for Business

Capital One Spark Classic For Business


Compare

Annual Fee:


$0

 

Purchase APR:


24.74%, Variable

One of the easiest small business credit cards to get, the Capital One Spark Classic for Business was made for those who want to build their credit. Despite being aimed at those with lower credit, this card still offers some decent perks.

To start, its base rewards dole out an unlimited 1% cash back without any sort of annual fee. This means you’ll be saving money no matter what your yearly spending rate is. Additionally, you’ll be able to add employee credit cards at no additional cost. Capital One requires no foreign transaction fees—great if your business needs overseas travel.

For the in-depth rundown on Spark Classic, head on over to our full review.

Best Card For Bad Credit: Wells Fargo Business Secured Credit Card

Wells Fargo Business Secured Credit Card


business credit cards fair credit
Compare

Annual Fee:


$25

 

Purchase APR:


Prime + 11.90%

One of the lone secured cards for business, the Wells Fargo Business Secured Credit Card is an appealing option for those looking to boost a low credit score. Wells Fargo targets this card for those just starting a business, businesses with little or no credit, and those with past credit problems.

You also have a couple of reward options: get 1.5% cash back or one point per dollar spent, which can be redeemed for gift cards, merchandise, airline tickets, and more. Besides the base bonuses, you won’t need to worry about paying program or foreign fees. However, you’ll need to fork over $25 annually, and you can add up to 10 employee cards.

Want more low credit options? Check out our breakdown of the best business credit cards for those with bad credit.

FAQs About New Business Credit Cards

Do I need business credit to get a business credit card?

No, when you apply for a business credit card, issuers will also consider your personal credit history, which can be used to guarantee repayment.

What business information do I need to supply to get a credit card?

When applying for a business card, issuers usually request your company’s business tax identification number. If you don’t have one, you can often supply your personal social security number instead. They’ll likely ask you for your business’s legal structure, its ownership type, and its age. It’s also not uncommon for issuers to request your annual revenue, how much you spend, and which country your business is located in.

Can I still get a business credit card if I’m not registered as a business?

Yes, you don’t need to be officially registered as a business to get a business credit card. Find out more with our guide to business cards for the self-employed.

Can I get a new business credit card without signing a personal guarantee?

Usually, no. If you’re a new small business owner, you’ll most likely have to sign a personal guarantee.

Can I use personal credit cards for business?

Yes, there are a number of reasons why you might prefer a personal card, from better legal protection to better potential rewards. We go into more depth on the subject in our personal credit card guide.

Comparison Of The Best Credit Cards For New Business Owners

Card Name Best For Next Steps

SimplyCash Plus Business Credit Card from American Express

Cash back

Compare

Chase Ink Business Preferred

Travel rewards

Apply Now

Chase Ink Business Cash

No annual fee

Apply Now

Blue Business Plus Credit Card from American Express

0% introductory rate

Compare

Capital One Spark Classic For Business

Fair credit

Compare

Wells Fargo Business Secured Credit Card

Bad credit

Compare

The post Best Credit Cards For New Business Owners appeared first on Merchant Maverick.

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Best Business Credit Card Signup Bonus Offers

Finding a credit card with a great welcome offer is an easy way to earn some extra cash or bonus travel miles. If you’re a small business owner, finding places to save an extra buck is always important.

Of course, there are numerous credit cards and many different types of bonus offers. Figuring out your best option can be tricky. Our list below aims to help you sift through all your options—helping you find what you’re looking for faster!

Best Signup Bonus For Rewards Points: Chase Ink Business Preferred

Chase Ink Business Preferred



Apply Now 

Annual Fee:


$95

 

Purchase APR:


17.74% – 22.74%, Variable

This card from Chase comes with a hefty points reward for new accounts. Simply spend $5,000 within the first three months of opening your account and you’ll receive 80,000 bonus points. When you redeem those points through Chase Ultimate Rewards, you can receive the equivalent of $1,000 towards travel. If travel rewards aren’t for you, Chase Ultimate Rewards also lets you redeem points for gift cards, cash back, and Amazon shopping.

Those points can be transferred on a 1:1 basis to an array of airline and hotel reward programs as well. For general rewards with Chase’s Ink Business Preferred, you earn three points per $1 spent on travel, shipping purchases, Internet, cable and phone services, and on online advertising purchases. You then get one point per dollar on everything else.

Chase also runs a referral program that nets you 20,000 bonus points (up to 100,000 per year) when a business owner you invite signs up for a Chase Ink Business Preferred card.

Check out the full details with our in-depth review.

Best Signup Bonus For Cash Back: Capital One Spark Cash For Business

Capital One Spark Cash For Business


capital one spark cash select
Compare

Annual Fee:


$95 ($0 the first year)

 

Purchase APR:


18.74%, Variable

If you simply want cash back as a bonus offer, it’s hard to beat Capital One’s Spark Cash For Business card. This card rewards you with $500 if you spend at least $4,500 within the first three months of opening your account.

Because Capital One bundles in unlimited 2% cash back on all purchases, you’ll also be receiving some of the best cash back rewards a credit card can offer. The $95 annual fee is also waived for your first year.

Get the complete run-down on the Spark Cash For Business by reading Merchant Maverick’s review.

There are a few other business cards with $500 cash back welcome offers. We’ve listed them below in alphabetical order:

  • Chase Ink Business Cash: $500 cash back if you spend $3,000 in your first three months.
  • Chase Ink Business Unlimited: $500 cash back if you spend $3,000 in your first three months.
  • Wells Fargo Business Platinum Card: $500 cash back if you spend $5,000 in your first three months.

Best Signup Bonus With No Annual Fee: Chase Ink Business Unlimited

Chase Ink Business Unlimited


chase ink business unlimited
Apply Now 

Annual Fee:


$0

 

Purchase APR:


14.99% – 20.99%, Variable

Want a nice signup bonus but don’t want to deal with a pesky annual fee? The Chase Ink Business Unlimited card might just be for you. Spend over $3,000 in your first three months and you’ll get $500 cash back without needing to worry about an annual fee.

For base rewards, Chase offers unlimited 1.5% cash back on all purchases. You also won’t have to worry about paying interest for your first year—this card carries a 0% intro APR for the first 12 months.

If you need more details on the Ink Business Unlimited, check out Merchant Maverick’s full review.

It’s also worth a mention that if you spend a lot on specific categories, you may prefer Chase’s Ink Business Cash card. It features the same welcome offer of $500 after spending $3,000 within the first three months. However, purchases within the office supply store, Internet, cable, and phone categories net you up to 5% cash back. You also get up to 2% cash back on money spent at gas stations and restaurants. For a holistic report, read our Ink Business Cash card review.

Best Signup Bonuses For Travel

Best Signup Bonus For General Travel: Capital One Spark Miles For Business

Capital One Spark Miles For Business


Compare

Annual Fee:


$95 ($0 the first year)

 

Purchase APR:


18.74%, Variable

Those that want a solid welcome offer aimed at travel without being locked into a particular airline or hotel brand should consider Capital One’s travel business card. Spark Miles For Business dishes out 50,000 miles if you spend $4,500 within your first three months. You’ll be able to use those miles for tickets on any airline, booking any hotel, purchasing travel packages, and more.

It does come with a $95 annual fee, although this is waived your first year. For general rewards, you get an unlimited two miles per dollar spent. When it comes to redeeming your rewards, there are no blackout dates and no minimum points requirement.

Visit Merchant Maverick’s complete review to get in in-depth look at Capital One’s Spark Miles card.

Chase’s Ink Business Preferred (mentioned above) is also a nifty card for travelers because points are worth 25% more when redeemed for travel through Chase Ultimate Rewards. You can also transfer your points on a 1:1 basis to a selection of airline and hotel rewards programs. Our full review has all the details.

Best Signup Bonus For Airline Points: Delta Reserve for Business Credit Card from American Express

Delta Reserve Credit Card for Business from American Express



Compare

Annual Fee:


$450

 

Purchase APR:


17.74% – 26.74%, Variable

For those looking at welcome offers of airline-specific cards, your best option will usually come down to which airline you use the most. However, when it comes to picking one airline-specific travel credit card, our choice goes to American Express’s Delta Reserve for Business Credit Card. This card will reward you with 70,000 miles and 10,000 Medallion Qualification Miles once you spend $5,000 within your first three months. Note that this offer expires 11/07/2018.

Its base rewards include two miles per dollar spent on Delta purchases. Everything else you buy gets one mile per $1 spent. You also get a free checked bag, priority boarding, and Delta Sky Club access. There’s an additional bonus offer handing out 15,000 miles and 15,000 Medallion Qualification Miles if you spend $30,000 or more during a calendar year.

Of course, there’s plenty of other airline-specific offerings with excellent welcome offers. Here’s a non-exhaustive list, ordered alphabetically:

  • AAdvantage Aviator Business Mastercard from Barclays: 60,000 miles once you make your first purchase within 90 days.
  • Alaska Business Card from Bank of America: Buy one ticket, get one for only taxes and fees plus 30,000 miles if you spend $1,000 or more within 90 days of opening your account.
  • CitiBusiness / AAdvantage Platinum Select World Mastercard: 70,000 AAdvantage miles if you spend $4,000 in your first four months.
  • Gold Delta SkyMiles Business Credit Card from American Express: 30,000 miles if you spend $1,000 in your first three months and a $50 statement credit once you make a Delta purchase in your first three months.
  • JetBlue Business Card from Barclays: 50,000 points if you spend $1,000 in the first 90 days.
  • Platinum Delta SkyMiles Business Credit Card from American Express: 50,000 miles and 10,000 Medallion Qualification Miles if you spend $3,000 in your first three months and a $100 statement credit once you make a Delta purchase in your first three months.
  • Southwest Rapid Rewards Premier Business Credit Card from Chase: 60,000 points if you spend $3,000 in your first three months.

Best Signup Bonus For Hotel Rewards: Hilton Honors American Express Business Card

Hilton Honors American Express Business Card



Compare

Annual Fee:


$95

 

Purchase APR:


17.74% – 26.74%, Variable

Like with airline-specific cards, your best option for welcome offers from hotel rewards cards really comes down to where you stay the most. The best all-around welcome offer, however, hails from the Hilton Honors American Express Business Card. This rewards card packs in a bonus of 125,000 points if you spend $3,000 within the first three months of opening your account.

For regular rewards, you’ll get 12 points per dollar when you make purchases at hotels and resorts within the Hilton brand. You’ll also snag six points per $1 spent when making U.S.-based purchases at gas stations, wireless telephone service providers, shipping merchants, and restaurants. You can also pick up six points per dollar when booking travel through American Express’s travel website or on car rentals booked directly from specific car rental companies. All other purchases will nab you three points per $1 spent.

Don’t frequent Hilton branded hotels? Here’s a couple more bonus offers from hotel rewards cards to glance over:

  • Starwood Preferred Guest Business Credit Card from American Express: 100,000 points if you spend $5,000 in your first three months.
  • Marriott Rewards Premier Plus Business credit card from Chase: 75,000 points if you spend $3,000 in your first three months.

Comparison of the Best Business Credit Card Signup Bonus Offers

Card Name Best For Bonus Offer Requirements Next Steps

Chase Ink Business Preferred

Reward points

80,000 points

Spend at least $5,000 within the first 3 months of opening an account

Apply Now

Capital One Spark Cash For Business

Cash back

$500 cash back

Spend at least $4,500 within the first 3 months of opening an account

Compare

Chase Ink Business Unlimited

No annual fee

$500 cash back

Spend at least $3,000 within the first 3 months of opening an account

Apply Now

Capital One Spark Miles For Business

General travel rewards

50,000 miles

Spend at least $4,500 within the first 3 months of opening an account

Compare

Barclays AAdvantage Aviator Business Mastercard

Airline points

60,000 points

Make at least one purchase within the first 90 days of opening an account

Compare

Hilton Honors American Express Business Card

Hotel rewards

125,000 points

Spend at least $3,000 within the first 3 months of opening an account

Compare

The post Best Business Credit Card Signup Bonus Offers appeared first on Merchant Maverick.

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Self-Employed? You May Qualify For A Business Credit Card

Being self-employed brings great freedom and flexibility when it comes to scheduling, determining work flow, and setting pay rates. But there’s one more benefit that you might not immediately think about: getting a business credit card. Even though you may not run your work as a “business,” you still could be eligible for a business credit card. There are plenty of benefits to having a business credit card, so perhaps it makes perfect sense for you to apply for one.

Is a business credit card right for you? Read on through to find out!

Do I Need An “Established Business” To Get A Business Credit Card?

blogging

Not necessarily. You might qualify as a business owner as long as you sell goods or services outside of a traditional employment situation, enabling you to get a business credit card.

You may qualify if you sell items via online storefronts such as Amazon or eBay or offer lessons for activities like music or art. You may even qualify if you provide freelance services such as writing, photographing, or writing code. Do a maintenance side gig for friends and neighbors? That could qualify you, too.

Essentially, if you make profit doing something outside your day job or personal life, you could qualify as a business owner.

What Are The Perks Of A Business Credit Card For The Self-Employed?

There are numerous benefits to maintaining a business credit card while self-employed.

The primary reason you might want to apply for a business card is so that you can separate your professional expenses from your personal ones. This means you can keep easier track of business-related spending—something that’s important for both budgeting and filing taxes.

Reward programs are also structured for business expenses. For instance, some business-specific cards offer rewards geared towards travel, which might be beneficial if you spend time flying for work. Some cards also bundle in perks like access to airport lounges or free wifi.

Additional business credit card benefits can include excellent sign-up bonuses, higher potential credit limits, and free employee cards.

Are There Any Drawbacks To Watch Out For?

As with any credit card, it’s important to always pay off your balance on time. Doing so limits interest while potentially improving your credit score.

You’ll also want to avoid applying for too many cards in a short space of time. That’s because applying for a credit card results in a hard pull on your credit score. Too many hard pulls in quick succession could drop your credit score.

How Do I Apply For A Business Card?

You’ll want to first do proper research to find the best card for you. Not all cards are equally good for everyone. Some cards look snazzy up front, but they may not mesh with your professional pursuits. With that in mind, you’ll want to look for a card that has rewards that align with your business expenses while also allowing you to make the most of the card’s other benefits.

Because you’re self-employed, you might not have a history of business income or a business tax identification number. In most cases, card issuers will do a pull on your personal credit and your personal income to guarantee your credit history. Additionally, your social security number can often be used in place of a tax ID number. During the application process, you can also usually list yourself as a sole proprietor when filling out what kind of business you own.

And most importantly, never lie on a credit card application. Lying about your business or making up business income will only bring about a world of hurt in the future—even if you somehow manage to get approved.

How Can I Improve My Chances Of Being Approved For A Business Credit Card?

As with any credit card, it always helps to have a good credit score. Ultimately, though, issuers have their own criteria when deciding who gets approved and who doesn’t. As such, you’ll want to double-check that you meet the requirements of a card before applying.

Top Business Credit Card Pick For The Self-Employed

Chase Ink Business Preferred



Apply Now 

Annual Fee:


$95

 

Purchase APR:


17.74% – 22.74%, Variable

The best option for many small businesses, Chase Ink Preferred is a great choice for those who are self-employed, too. This card from Chase is simply a solid, well-rounded offering.

It packs in three points per $1 on the first $150,000 spent in combined purchases on travel, shipping, internet/cable/phone services, and advertising on social media and search engines each account anniversary year. For all other purchases, you’ll get one point per dollar spent.

On top of that, you’ll get a bonus 80,000 points after you spend at least $5,000 in the first three months of opening your account. Because points usually equal $0.01, that’s the equivalent of $800 cash back. Chase also bundles in cell phone protection and employee cards at no extra cost.

You can also reap plenty of travel benefits, too. To start, points are worth 25% extra when redeemed through Chase Ultimate Rewards. You can further transfer points on a 1:1 basis with other travel programs, including United MileagePlus and Marriott Rewards. Finally, there is no fee on foreign transactions, a plus if you travel overseas frequently.

Final Thoughts

Want more business card options? Check out our comprehensive breakdown of the best business cards of 2018. Decided to stick with a personal credit card? We’ve got you covered with a list of the best personal credit cards for business expenses.

The post Self-Employed? You May Qualify For A Business Credit Card appeared first on Merchant Maverick.

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Emergency Business Loans: 7 Ways To Get Business Funding Fast

No matter how good you are at planning, it’s impossible to prepare for every possible emergency that may affect your business. Acts of God like hurricanes, floods, and fires aside, invoice payments might be late. You may have experienced a fluke sales slump. Or maybe you just need to restock before a big event next week to maximize your sales.

You’ve already shaken out your pants for loose change, so now what do you do? Where do you look for an emergency business loan?

Read on and we’ll try to help you out. Here are seven ways to get business funding fast.

1. Get A Short-Term Loan

fast business loans

If it has been a while since you last looked for financing, you’re probably imagining long, drawn-out loan applications with high credit restrictions.

Those traditionally-structured loans still exist–and tend to have excellent rates–but they’re not much help when you need money fast. An easier way for most businesses to get a lump sum of cash quickly is to get a short-term loan.

Short-term loans usually last less than a year, feature simplified (and usually online) applications, and can get cash into your account within 24 to 72 hours. Most of them don’t even require collateral in the traditional sense.

So what’s the catch? Well, you’ll probably be going through an alternative lender. That means higher rates and fewer regulatory protections than you’d find with a bank.

Because the repayment schedule is accelerated, these loans charge a flat fee instead of instead of interest. This fee is a percentage of the amount you borrowed ($10,000 x 20% = $2,000, so you’ll be on the hook for $12,000). You’ll also be paying it back much more quickly. Repayment intervals are weekly or even daily, with fixed payments automatically withdrawn from your business bank account.

Think a short-term loan is right for you? Check out the following short-term lenders:

Lender Borrowing Amount Min Credit Score Time To Funding Next Steps

$2K – $5M 550 1-2 Days Apply Now

$5K – $500K 550 1-3 Days Apply Now

$5K – $500K 500 2-5 Days Apply Now

$5K – $250K 500 2-5 Days Apply Now

2. Get A Merchant Cash Advance

how to get a merchant cash advance

I know we’re technically talking about “loans,” but if you need money quickly, you’re probably not that concerned with semantics. For the pedantic, a merchant cash advance (MCA) is the purchase of your future credit/debit card sales. So you’re technically selling something, not taking on debt. Confusing, right?

An MCA fulfills a similar niche to a short-term loan and shares a few characteristics with it. MCAs also feature simplified applications and qualifications; they’re even less governed by financial regulations than short-term loans. You’ll also usually have your money in a day or two. MCAs and short-term loans even share a flat fee approach, where the amount you owe is the amount you “borrowed” plus a percentage of that amount ($10,000 x 20% = $2,000, for a total of $12,000).

But wait, didn’t I say the MCA company was actually buying a percentage of your future receivables? How does that work? Rather than making payments, the MCA company will collect a percentage of your daily credit- and debt-based sales until they’ve collected the lump sum they gave you, plus their flat fee. Because your sales may vary from day to day, MCAs don’t have exact term lengths. If your sales are good, you’ll pay the debt off more quickly; if they’re poor, it will take longer to pay off.

Be aware, however, that MCAs are one of the most expensive ways to borrow money.

Want to explore your options? Check out the following providers of merchant cash advances:

Lender Borrowing Amount Min Credit Score Time To Funding Next Steps

$2K – $5M 550 1-2 Days Apply Now

$5K – $500K 550 1-3 Days Apply Now

$5K – $500K 500 2-5 Days Apply Now

$5K – $250K 500 2-5 Days Apply Now

3. Get An Express Bank Loan

What’s an express loan? The definition varies by lender, but in general, this is an option offered by many traditional banks. Thanks, in part, to pressure from alternative lenders, banks have made efforts to speed up the application processes of some of their products. If you need a small amount of money relatively quickly, it may be the way to go.

These loans typically aren’t short-term loans, but medium-term installment loans. That means monthly payments and interest accruing over time.

Compared to short-term loans, express loans will often have better rates but aren’t as easy to qualify for. Depending on the bank, the speed with which you can get funding may be competitive with those of alternative lenders, while others might be a little bit slower. Note that SBA Express loans, while quicker than other SBA loans, probably aren’t going to be fast enough to cover an emergency expense. On the other hand, if your emergency is the result of a regional disaster, you may want to check out SBA disaster loans.

4. Get An Installment Loan From An Alternative Lender

installment loans

Wait, aren’t installment loans–express loans notwithstanding–too slow to be much help in an emergency?

Alternative lenders don’t only deal in short-term loans and merchant cash advances. Some offer products that more closely resemble traditional installment loans. These loans feature longer-terms and regular monthly (sometimes weekly) payments.

Installment loans, even those from alternative lenders, don’t necessarily promise the 24-48 hour turnarounds that are common with short-term loans and merchant cash advances. Some do, however. And even the ones that don’t may still be fast enough to help resolve your emergency.

These alternative lenders offer loan products that might work for your situation:

Lender Borrowing Amount Term Interest/Factor Rate Req. Time in Business Min. Credit Score Next Steps

$5K – $500K 3 – 36 months x1.003 – x1.04/mo 12 months 500 Apply Now

$5K – $500K 13 – 52 weeks x1.029 – x1.1872 9 months 550 Apply Now

$2K – $5M Varies As low as 2% 6 months 550 Apply Now

$20K – $500K 1 – 4 years 7.99% – 29.99% APR 2 years 660 Apply Now

5. Use A Business Credit Card

Best merchant online credit card processing companies image

Another way to handle emergency expenses is to have lines of credit in place ahead of time. The easiest to use are probably business credit cards.

Business credit cards can be a convenient way to pay for emergencies, provided the emergency costs are on the smaller side and can be paid with plastic. A balance that sits on your card month after month will quickly become more expensive than a loan. On the other hand, if you’re able to pay your business credit card off in full within your grace period (usually 20-25 days after you make the purchase), you won’t owe any interest at all. Better yet, you can take advantage of the rewards programs most of these cards offered.

Avoid taking out a cash advance with your credit card, though, as the fees and interest rates on those transactions make them a very expensive way to bail your business out.

Looking for a business credit card? Chase Bank offers some of the best options for small business:

Card Card Name Annual Fee Introductory Rate Rewards Next Steps

Chase Ink Business Preferred℠

$95 None
  • 3 points per $1 on travel, shipping, internet/cable/phone, and internet advertising (max $150,000 per year)
  • 1 point per $1 on all other purchases
Apply Now

Chase Ink Business Cash℠

$0 0% APR for the first 12 months
  • 5% cash back on internet/phone/cable and purchases at office supply stores (max $25,000 per year)
  • 2% cash back at restaurants and gas stations (max $25,000 per year)
  • 1% cash back on all other purchases
Apply Now

Chase Ink Business Unlimited℠

$0 0% APR for the first 12 months
  • 1.5% cash back on all purchases
Apply Now

6. Set Up A Line Of Credit

Business credit cards aren’t the only way to set up an “insurance policy” against unplanned expenses. In fact, they may not even be the best way, especially if you encounter expenses you can’t easily pay for with a card.

Banks and some alternative lenders offer business lines of credit. A revolving line of credit is a lot like a credit card (technically a credit card is a revolving line of credit, but not all revolving lines of credit are credit cards. Make sense?). Your lender will approve your business for a certain amount of credit, for a certain period of time, typically a year. During that time, you can draw upon your line of credit in any increments you want so long as the total amount you’ve drawn doesn’t exceed your credit limit. You only make payments and owe interest on the amount of credit you’re using. As you pay off your balance, that credit becomes available to use again. A non-revolving line of credit works the same way, except that once you use your credit, it does not become available again after you pay it off.

Some lines of credit are easier to use than others. Depending on your lender, you may have to pay a draw fee each time you withdraw cash. Some lenders charge annual, or even monthly, fees to maintain your line of credit. It’s not uncommon for banks to link a line of credit to a Visa or Mastercard, allowing you to use it almost exactly like a credit card. Some lenders may let you write checks against your line, while others will necessitate a cash transfer from your line to, say, a checking account.

The following lenders offer lines of credit to businesses at reasonable rates:

Lender Borrowing Amount Draw Term Draw Fee APR Next Steps

$6K – $100K 6 months None Starts at 13.99% Apply Now

$2K – $5M Varies Varies Varies Apply Now

$5K – $5M 6 months 1.50% per draw 21% – 65% Apply Now

$1K – $100K 12 weeks None 12% – 54% Apply Now

7. Use Invoice Factoring

Do what now? A quick and unorthodox way to get emergency financing without putting yourself at too much risk is invoice factoring. Factoring companies will purchase your unpaid invoices for around 80 percent of their face value, minus a small fee. It’s essentially getting an advance on your invoices by signing them over to a third party.

What about the remaining 20 percent? The factoring company will pay you that balance when the invoice is paid by your customer.

The catch is that you’ll need to have unpaid invoices in hand for invoice factoring to be of any use to you.

If you think invoice factoring might be the right choice for your business emergency, we recommend starting with a reputable company like BlueVine.

Get Started With BlueVine

Final Thoughts

It’s easier than ever to get emergency funding for your business. The trick is making sure you get it on the schedule you need, at a rate you can afford.

Not sure where to start looking?

We can help you out.

Loan Type What Is It? Typical Time To Funding

Short-Term Business Loans

Loans disbursed in one lump sum and repaid in periodic, fixed installments. Fees for borrowing are determined by a factor rate.

2 – 5 days

Online Lines of Credit

Credit lines from which the business can draw funds at any time, without going through an application process.

2 – 7 days for the initial application; 1 – 2 days for funds when the credit line is secured

Invoice Financing

Financing in which the business’s unpaid invoices are leveraged to access business funds.

2 – 5 days

Bridge Loans

Fast business loans used to fulfill funding needs until slower financing comes in.

2 – 7 days

Traditional Installment Loans

Loans disbursed in one lump sum and repaid in periodic, fixed installments. Borrowing fees are determined by an interest rate.

1 – 3 weeks

Business Credit Cards

Credit lines for everyday business expenses.

About 7 days

SBA Disaster Loans

Loans offered by the SBA to businesses that have been affected by a disaster.

7 – 21 days

The post Emergency Business Loans: 7 Ways To Get Business Funding Fast appeared first on Merchant Maverick.

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Business Credit Cards With The Best Reward Programs

In many cases, a good rewards program sets a credit card apart from its peers. Businesses can then take advantage of a rewards program to save money and earn bonuses. Depending on how much a business spends, it could net thousands of dollars in rewards every year.

However, not every rewards program fits every business. For instance, some rewards programs grant more points at hotels—a boon for businesses that require frequent travel. Meanwhile, others give extra rewards for purchasing office supplies—a great fit for businesses that are always improving their workspaces. There is simply so much variety.

After noticing this complexity, we at Merchant Maverick decided to do a thorough breakdown of the business credit cards with the best rewards programs. Read on through below!

Best For Cash Back Rewards: American Express SimplyCash Plus

American Express SimplyCash Plus



Compare

Annual Fee:


$0

 

Purchase APR:


13.99% – 20.99%, Variable

Put plainly, cash back business cards are an easy and convenient way to save money. With a cash back card, you earn back a certain percentage of what you spent each time you make a purchase. Cash back cards have the added bonus of usually being less complicated than points reward structures.

Why It’s Our Pick:

If you make frequent purchases at office supply stores and on wireless telephones, the American Express SimplyCash Plus is a no-brainer. That’s because this card features 5% cash back via statement credit for purchases within both categories (up to $50,000).

On top of that, American Express lets you pick one category on which to get 3% cash back (up to $50,000), allowing you to tailor the card to fit your business. Available categories in the 3% range include airfare, hotel rooms, car rentals, gas stations, restaurants, advertising, shipping, computer hardware, software, and cloud computing.

Besides those tiers, SimplyCash Plus offers 1% on all other purchases. In addition, there’s no annual fee and 0% APR for the first nine months. To get full details, visit Merchant Maverick’s in-depth review.

Honorable Mention: Chase Ink Business Cash

Chase Ink Business Cash



Apply Now

Annual Fee:


$0

 

Purchase APR:


14.99% – 20.99%, Variable

Like SimplyCash Plus, Chase Ink Business Cash offers 5% on purchases at office supply stores. Instead of just wireless telephones, this card also features 5% on internet, cable, and phone purchases. However, the rewards cap out at $25,000 instead of $50,000. Additionally, Chase has set the second reward tier at 2% cash back (up to $25,000) and it’s only for gas stations and restaurants. All other purchases receive 1% cash back.

Still, this is a solid option if you’re looking for something different than what American Express is offering. Plus, it features no annual fee and a 0% APR for 12 months. Check out our complete review for all the details.

For more cash back cards, check out our best picks.

Best Airlines & Travel Rewards Program: Chase Ink Business Preferred

Chase Ink Business Preferred



Apply Now 

Annual Fee:


$95

 

Purchase APR:


17.74% – 22.74%, Variable

If your business requires lots of travel you may want to get a business credit card that includes benefits for airlines and travel. Getting a card with specific travel benefits could reap greater rewards than you’d get from just a standard cash back card.

Chase Ink Business Preferred gets our top pick for travel business credit card because you earn three points per $1 spent on travel (as well as on shipping, internet/cable/phone services, and online advertising). On top of that, points are worth 25% more if you redeem them for travel through Chase Ultimate Rewards. Additionally, you can transfer your points on a 1:1 basis to other travel programs, such as United MileagePlus and Marriott Rewards. Get the full picture via Merchant Maverick’s review.

To compare more travel cards, we’ve got you covered with our list of the best business travel cards.

Best Hotel Rewards Program: Starwood Preferred Guest American Express Luxury Card

Starwood Preferred Guest American Express Luxury Card


starwood luxury amex
Compare

Annual Fee:


$450

 

Purchase APR:


17.49% – 26.49%, Variable

Businesses that spend a decent chunk of change on hotels may want to look for something even more specific than a generic travel rewards card. That’s because a card geared toward hotel rewards can offer you better rewards when used properly.

The Starwood Preferred Guest American Express Luxury Card is our top pick because it doles out six points per $1 spent at participating SPG and Marriott Rewards hotels. Beyond that, you can earn three points per $1 spent at restaurants and airlines. Points can then be redeemed for free nights at SPG and Marriott Rewards hotels, as well as for flights and car rentals. Learn more by reading our review.

Best Rewards Points Program: American Express OPEN Business Gold Rewards

American Express Business Gold Rewards


amex business gold rewards review
Compare

Annual Fee:


$0 the first year, then $175

 

Purchase APR:


N/A (This is a charge card)

Going with a points-based system (instead of one that gives cash back) can be an excellent option should the points be redeemable for a service you frequently use. For instance, if you have a card that allows you to redeem your points on a specific hotel, you could be able to save money on bookings or get free room upgrades.

The American OPEN Business Gold Rewards charge card features an enticing and well-rounded points program. You get three points per $1 spent on the category of your choosing (out of airfare, advertising, gas stations, shipping, and computer hardware, software, and cloud computing), two points per $1 for each the four categories you didn’t choose, and one point per $1 on everything else. Points can be redeemed at an array of airlines, hotels, and merchants. Do note, however, that because this is a charge card, you’ll have to pay off your balance every month. Read Merchant Maverick’s review for more info.

Best Overall Rewards Program With No Annual Fee: American Express Blue Business Plus

American Express Blue Business Plus



Compare

Annual Fee:


$0

 

Purchase APR:


12.99% – 20.99%, Variable

If you’re looking for a well-rounded rewards program with no annual fee, it’s hard to go wrong with the American Express Blue Business Plus. This card packs in two points per $1 spent (up to $50,000) on all purchases, making it very attractive to businesses that buy from a range of categories. After you pass the $50,000 threshold, you earn one point per $1. Beyond rewards, it features 0% APR for the first 15 months. Get squared away with all the facts in our review.

Frequently Asked Questions:

Is my personal credit score used to determine approval?

Yes, almost all issuers check with consumer credit bureaus when you apply for a business card.

How can I build my business credit fast?

Unfortunately, it’s difficult to build credit fast. As long as you pay off your debts and keep your accounts from running delinquent, your credit score should rise. Find out more by reading the Merchant Maverick guide to building business credit.

Do I lose rewards on returned purchases?

In most cases, you will lose your rewards on returned purchases. However, you may be able to keep rewards points if you accept in-store credit for the returned item.

Will I lose rewards points if I pay my credit card balance early?

In most situations, you earn your points based on when you bought an item or service. It doesn’t matter when you pay your balance; you should still earn your reward points when paying the balance early.

How do I redeem my credit card rewards?

It depends on the rewards program. Some allow you to request cash back via statement credit or check. Others offer points you can redeem for gift cards, physical items, flights, car rentals, or hotel rooms.

Now What?

If you want to compare more credit cards for small businesses, visit our comparison page. Those with good credit may also want to check out the best business cards for good credit. Making a big purchase? Read up on our list of the best 0% intro APR cards.

The post Business Credit Cards With The Best Reward Programs appeared first on Merchant Maverick.

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