SBA Loan New Market For Sports
Author: Valerie Mellema
Date posted: 04.24.23

Sports and recreation stores are huge parts of the community, especially in the Midwest. One shop had become a staple of the metropolitan area and continued to bring in more profit year after year. The owners were happy to play a part in serving the people of the state by helping them enjoy exercise, sports, and the great outdoors. Of course, every business has room to improve. The owners were fully aware of that and often had meetings about how to do things better. One of those meetings led to a huge project that would define the company from that moment on.

Rural Areas Love Sports and Recreation Too

 

At this meeting, one of the owners brought up the idea of expanding. Rather than recommending a branch in the big city (or even one of the suburbs), they instead focused on a small rural town in the area. At first, the owners weren’t all on board but the more they researched, the more it looked like a great idea.

 

Rather than plowing forward, they wanted to look into their options. If the cost was reasonable and they could find the right financing option, they decided the idea of expanding into smaller markets could be useful. So they all went to work to find out more information about the potential expansion.

 

The Cost to Open a New Store

 

Once costs were nailed down, they came together to talk again. Based on the information the owners found in research, they were fairly sure they could move forward and open the new location for $400,000. This would take care of the land and building, as well as filling it with stock and all the other extras associated with a new business.

 

Now the new question was whether putting this much into the project was worth it. After the owner who recommended the decision shared a presentation, most of the owners were on board. The next step was to look into what kind of financing would be the right choice.

What About Appropriate Financing?

 

Since opening a whole new store is a major undertaking, the right financing is a must. The owners had an idea of their options but decided to research to make sure they weren’t missing out on an opportunity that would work well for them. A traditional bank loan was an option but they didn’t want to move in that direction without further time to think about it.

 

In the end, the SBA 7(a) loan turned out to be the best option. It gave them plenty of funding to get the store up and running and came with several extra perks. Once they had an idea of the costs and financing options, they decided to move forward with the expansion.

 

There’s Nothing Better Than an SBA 7(a) Loan

 

The company easily met all the requirements for the loan, such as a good FICO score, at least two years in business, and a good annual revenue. They were happy with the decision to go for an SBA 7(a) loan for many reasons, not least of which was the affordability.

 

SBA loans have a long term length and a lower interest rate, two things that were important to the owners. In addition, it had fixed monthly payments and had funding within a few months of being approved.

How Are Things Today?

 

After getting the needed funding, the company was able to break ground on the new location. Since then, the store has opened and it has seen huge business from the rural community. The company is paying back the loan now but has already talked about whether they should continue opening branches in smaller towns that may not have as many options.

About The Author | Valerie Mellema

Valerie has over 16 years of experience as a professional writer of blogs, eBooks, articles and press releases, with a focus on finance and alternative lending. Valerie resides with her family in Texas and is passionate about her horses.

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