The Need to Fund a Larger Catalog

 

Everyone wants to see their business grow. It’s something that shows a business owner is doing something right. This applied to the furniture store just as much as it would to any other type of company. Growth continued for the store over a long period, until it was clear that moving forward with new products was the best option.

 

Along with that, the store would need to be remodeled to make it spacious and allow room for the newly introduced products. However, as a business that gets most of its money doing seasonal business, the owners knew it might be hard to secure a traditional loan.

 

How Much Financing Is Enough?

 

To renovate the building and add new stock, there was no choice other than to find financing. It was important to the owners that the method be flexible and affordable without extreme interest rates.

 

After doing the research, it was clear that the store would need $500,000 to get the process done. This would be a great way to ensure it could keep scaling and growing if the influx of customers continued. With numbers in hand, it was time to consider financing options.

An Asset-Based Loan Fits the Bill

 

There were many directions the store could turn to find financing. However, it was important that costs were kept low and flexibility was provided. After all, the furniture store had many assets that could be used as collateral if the right financing option popped up.

 

After considering other options like merchant cash advances, SBA loans, and business lines of credit, the owners decided on an asset-based loan.

 

Reasons to Choose an Asset-Based Loan

 

Asset-based loans come from a bank or other financial institution and are secured using the assets of the business. The types of assets that can be used include everything from accounts receivable to equipment or inventory. Plus, up to 85% of the value of assets can be financed.

 

With collateral in the mix, the loan would have a low interest rate with monthly payments. This seemed like a good choice for the furniture store. While funding can take up to 90 days, that wasn’t an issue. Moving forward was important for the owners but it didn’t have to happen in a short timeframe.

What Happened After?

 

This store used the asset-based loan several times as the store continued to grow. Eventually, the brand was able to expand and bring its products to other cities and states. It was challenging to deal with the seasonal nature of the brand alongside the high amount of growth. However, the asset-based loan went forward and the company saw great things happen.

 

Through a long set of obstacles and accomplishments, the furniture store has an even brighter future in store for it. If all goes well, the company could continue to branch out into new locations and change the world of home decorating for the better.

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