SBA Loan Salon Opens New Location
Author: Valerie Mellema
Date posted: 07.25.23

After flourishing as an upscale hair salon in the Midwest, things were going well for what started as a small business created by someone with big dreams. The salon had expanded and moved locations in the past as the customer base continued to grow. With full schedules again, it seemed like a good time to consider other changes that could be made to allow the salon to continue its expansion efforts.

A Second Salon Could Be the Answer

 

Since the expansion had gone well and things had settled down, the leadership team got together to talk about how they could be even more successful. In the past, they’d talked about opening a second salon but never really decided it was the right time. With things going well and the knowledge that other clients could be reached, they decided to dig deeper and find out if having a second salon could be something to work toward.

 

Financing a New Space

 

One of the first things to consider was how much financing would be needed to get a good space across town. This would make the salon accessible to more people and give current clients an alternative if they wanted to have their hair needs handled closer to home. Research on similar situations gave them data that indicated they would need around $1.2 million to do things the way they wanted.

What’s the Best Financing Option?

 

From there, it was easy to start looking at financing options. There were many to choose from and the leaders wanted to be sure they chose the solution that would work best for their needs. Most alternative financing didn’t quite fit their needs, but looking at more traditional loans gave them a few options to choose from. When it was time to make a decision, they selected an SBA 7(a) loan.

 

Why Select an SBA 7(a) Loan

 

SBA loans are considered the gold standard for small businesses. They can be used for a wide number of business needs. What makes them unique is that the SBA guarantees a portion of the loan, which means interest rates are lower compared to similar loans. It takes a while to be approved but the perks make that well worth it. In this case, the salon could have the funding they needed with a term length of 10 years. Funding would take a few months but there was no hurry. In the end, the affordable financing made it clear that this was the best option to move forward with. The salon was approved and the work was able to start.

Looking Toward the Future

 

Today, the salon has two locations and both of them are doing brisk business. The business is bringing in more money than it ever could have with a single location. It’s also given many members of the community jobs to staff both of the salons. Right now, things couldn’t be better and the owners believe the SBA 7(a) loan is the largest reason for that.

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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