Dealing with a Downturn

 

Since COVID-19 first became an issue, more people have been staying home and avoiding public spaces. Lots of employees who normally went to the office or on trips no longer were doing that as frequently. This led to a downturn that quickly affected the hotel, even though it was a favorite in the state.

 

As time went on, the continued lack of guests started to cause problems. It wasn’t very long until there were cashflow problems. Since the owner had no intention of closing up shop, another tactic would be needed to weather the storm.

The Amount Needed to Rectify the Situation

 

Knowing that some kind of help was needed led to serious consideration about finances. The owner needed to consider how much money was needed to get by until bookings went back up. With the economy in a state of turbulence, gauging numbers was harder than usual.

 

With a mortgage to pay and other overhead expenses, the owner determined that $50,000 would likely be enough to keep things running. He spoke to his bank about funding options to get the process started.

 

Selecting an Appropriate Financing Option

 

A traditional business loan turned out to be unlikely. His bank was hesitant due to his less-than-perfect credit. Plus, at the time, there was a great deal of uneasiness surrounding the hotel sector. It was a blow to be told no, but the owner wanted to find out what other options might be available.

The Benefits of a Merchant Cash Advance

 

There were several reasons that the merchant cash advance was the right choice. First of all, it doesn’t require a perfect credit score. It also allows access to the money quickly, which was important in this case. There’s also no set payment amount so the owner could pay more when things were booming and less when they were slow.

 

While a traditional loan might take a week or more to acquire, many merchant cash advances give you funding in a day or two. This is a huge benefit when money is needed at the moment.

 

How Did Things End Up?

 

Thankfully, with the help of the merchant cash advance, the hotel pulled through when things were slow. Making payments based on bookings allowed them to keep going until more people were coming back to hotels. All in all, the financing may have been what let the hotel to continue operating.

 

Now, things are going well and traffic has picked up. The advance has been paid off and it looks like things will continue as they had before the downturn. The owner is happy to know that there are so many business financing options, even for those who might not have the best credit.

 

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