Alternative Funding: Restaurants and Bars

If you have a dream to open a bar or restaurant, you aren’t alone. However, it doesn’t take much research to know that even getting started is difficult and stressful. It can be hard to get ahold of finance, acquire all the equipment, hire staff, create a menu, and advertise to the local community. At South Florida Funding Group, we can help to ease one of these concerns with reliable routes to finance.

Below, we want to list the different avenues you might explore. We understand that not everybody has a strong credit history or won’t have access to traditional bank loans, and this is why we’re also going to show alternative funding examples. Whether you’re just getting started or need short-term help to keep running, you should find a viable solution.

Restaurants and Bars Traditional Business Loan

If you can manage it, a business loan through a traditional lender is one of the best options. As long as you can get approval, business loans will come with low-interest rates and good terms. Why? Because you have been through an extensive approval process and have shown that you’re a reliable borrower.

Unfortunately, the problem with business loans is that they’re difficult to obtain and you need a good credit score to qualify.

SBA Loans for Restaurants and Bars

As alternative funding specialists, this is the first of the solutions with which we can help at the South Florida Funding Group. The Small Business Association has been supporting new ventures for many years, and this is still the case with SBA loans. As the SBA guarantees a section of the loan, it reduces the risk for the lender and allows you to get the funding you need.

Depending on what you need, you can generally get anything from $30,000 to millions with this type of loan. Then, to repay, you will have up to 10 years (individual terms may differ). Although 7(a) is the most common option, there are others available. Normally, the 7(a) loan is for companies who have been in operation for some time and need additional help.

Equipment Financing for Restaurants and Bars

When it comes to alternative funding, equipment financing is actually one route that often goes forgotten. In our experience, it’s a great way to get help for a bar or restaurant because of the nature of the business. The more you think about a bar or restaurant, the more equipment you notice. As well as draft lines for drinks, you need chairs, tables, fridges, freezers, ice machines, ovens, microwaves, and more.

With this type of loan, you send a quote for a piece of equipment or machinery and the lender will send the money for this purchase. If you fail to pay back the loan, the lender will repossess the equipment. With this in mind, it’s the perfect way to fund new equipment without risking your personal finances or the finances of the business. It’s called a ‘self-secured’ type of finance, and we can help you get started with equipment financing today.

Merchant Cash Advance for Restaurants and Bars

Elsewhere, some bars and restaurants get their funding from merchant cash advances (MCAs). The application process is smooth, approval rates are high, and there’s flexibility depending on the sales your business makes. With this option, you get a lump sum from the lender. In return, you pay a percentage of card sales. It’s almost like getting the next month’s sales in advance, and this provides an opportunity to invest in the necessary areas rather than waiting for revenue.

One of the benefits of a merchant cash advance is that the amount you pay back each period depends on the sales figures you post. Therefore, post a low sales amount and you won’t need to struggle to make a huge repayment fee.

Unsecured Business Loan and Secured Business Loan for Restaurants and Bars

As your next option, we can help you to get either an unsecured business loan or a secured business loan. While the former is where your credit history enables you to get financing, a secured business loan is where you use a personal or business asset to provide security for the loan amount. If possible, you should always try to get an unsecured business loan first because you don’t have to risk any assets. If this isn’t possible, secured business loans have collateral and this is easier to obtain than an SBA loan.

Other Finance Options for Restaurants and Bars

For new and existing bars and restaurants, these are some of the best alternative funding options available. At South Florida Funding Group, we have experience helping businesses just like your own. Otherwise, you might find the financial help you need through the following methods:

• Getting help from colleagues, family, friends, and others
• Crowdfunding
• Credit cards
• Second mortgage or home equity loan
• Restaurant grants

It goes without saying, but we advise you to act with caution and only take steps when you’re sure they are the right ones. Speak with a financial advisor for tailored advice, consult with us at South Florida Funding Group, and you’ll then know the best course of action for your bar or restaurant.

Choosing South Florida Funding Group for Funding Restaurants and Bars 

If you have a dream, we would love to help you make it come true. When you succeed, we do too, and this is why we’re passionate about our alternative funding services. When you choose us, the application is free, you get a personal service, there are several options available to you, the process is fast and easy, and we can even assist those with a poor credit history (and bad credit!).

Banks may say no, and this is where we come in. Our experience and knowledge allow us to get access to funding even when everything seems lost. It doesn’t matter whether you’re in plans to launch a business, or you’ve been in business for some time and now need access to finance; either way, allow South Florida Funding Group to be the help you need.  QUALIFY NOW!