Nail salons are big business. In the United States alone, there are over 200,000 of them. And while that number has been growing steadily over the past few years, the industry is still relatively fragmented, with the vast majority of businesses being small, independently-owned shops.
For these small businesses, access to capital is often a challenge. Traditional bank loans can be difficult to obtain, and when they are available, the terms can be unfavorable. This is where short-term financing comes in.
Short-term financing is a type of loan that can provide businesses with the capital they need quickly. In many cases, short-term loans can be approved in just a few days, with the money being deposited into your account soon after.
For one small nail salon in Wisconsin, recovering from COVID was proving to be a challenge. While they were able to make rent and preserve their lease throughout the pandemic, they couldn’t keep their staff on payroll. Once nail salons were able to reopen, they found that they needed access to additional capital to get the business up and running again.
The owners turned to a short-term loan to get the working capital to buy supplies, get their staff back in the salon, buy protective gear, and advertise their reopening.
One of the primary benefits of short-term financing is that it can be used for a variety of purposes. Whether you need to purchase inventory, make repairs, or cover other unexpected expenses, a short-term loan can give you the flexibility to do so. Getting a short-term loan meant that the owners did not need to ask for approval for each expense.
The owners’ applied for a $60,000 short-term loan for 24 months. The application process for a short-term business loan was quick and they received approval within one day of submitting the application. The application required the owners to provide a completed application, a few months of bank statements, and their business tax return.
Short-term unsecured loans have higher interest rates than longer term loans, but the rate was less than they would have paid on their credits cards. And they did not have to pledge any of their personal assets to secure the business loan.
After the stressful 18 months of being forced to close, the nail salon was able to reopen and hit the ground running with access to the capital they needed. Within six months of reopening, their revenue was already at pre-pandemic levels.
If you’re a small business owner in need of capital, short-term financing may be the right solution for you. With its flexibility and favorable terms, it can provide the funding you need to grow your business.
Casey has 12 years of technical writing experience. She is also a CPA and bookkeeper. Casey graduated from the University of St. Thomas (Minnesota) with a B.A. in mathematics and currently resides in San Diego, CA.
