Choosing a Business Loan for Your Wholesale Company

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Choosing a Business Loan for Your Wholesale Company

Business Loan for Your Wholesale Company

Whatever the cause—financial insecurities or unprecedented times in the market, businesses can quickly find themselves caught amid hardship. As companies aim to maintain customers’ attentiveness, it is necessary to direct their focus to meet budgets, lower customer prices, and be strong among competitors.

As a wholesale business owner seeking to maintain or grow your business, the use of additional funds may be beneficial. Business loans can be used for facility expansion, to pay employees, the purchasing of additional high-quantity bundles of products, or any other company-related assistance. All companies increasingly compete on price and delivery of their product. Maintaining financial security is vital in achieving a competitive standpoint in the business market.

GoKapital is a financial company that offers business owners working capital solutions through business loan options. Some of our funding plans include revenue-based loans, unsecured business loans, equipment leasing, and more. During challenging times, small business owners require secure funding. capital offers funds that are often difficult to receive from traditional banks.

Benefits of Wholesale Distribution Financing

Financing for your business opens opportunities for success that could not otherwise be attained. Using a business loan opens additional opportunities for growth and expenditure. Simply, more capital allows a company to do business with retailers and merchants, enabling you to attain more profitable projects.

For those who are ready to expand their business, cash flow flexibility is a must. When you apply for Wholesale Distribution financing, fortunately, you can use the money for any business-related expense.

The potential for increased sales is another definitive advantage of a business loan. The higher your buying power, the more inventory can be stocked. Having higher inventory on your shelf allows you to sell your products at a lower price to clients. Greater spending power is essential for success to distributors.

How to Qualify

Depending on the lender you choose will determine the type of business loan needed for your wholesale company. Seeking such loans through a traditional bank requires extensive paperwork and a series of approvals before lending out funds. Should your company choose to seek an alternative lender, you have access to funds without the need for excess approval or time-consuming processes.

Even better, if your business credit history is not so good, choosing alternative lenders over other financial institutions may qualify you. Credit history will be an aspect of the process, although the overall success and daily revenue take precedence over qualifying for any business loan.

Some Wholesale Distribution Businesses struggle to get a loan for various reasons. Three of the most common barriers include:

  • Poor credit: Meeting insurance requirements and maintaining an adequate credit history is essential in qualifying for a loan. Good credit history tells a lender that you are trustworthy of using and paying back the money on time.
  • Short Business History: A company will have difficulty securing a loan if the history is not established for at least six months or more.

Too low of an Income: Businesses want to see revenue of at least $20,000 monthly.

What Are the Options for Funding A Wholesale Business?

There are various loan types of loans that can be taken to suit the needs of each company.

  1. The Small Business Administration has loan programs that provide financing that is affordable and flexible. This government agency supports small businesses and entrepreneurs across the United States. Companies often can benefit from this loan when having difficulties with applying for loans with traditional lenders. The requirements for this loan are often extensive and hard to meet. Most borrowers, however, conclude that the effort is awarded in the low-cost options.
  2. A credit line gives distribution companies access to funds as needed as long as you do not exceed the predetermined maximum spending amount. A notable requirement is to have a solid credit history and a long enough business background to gain approval.
  3. Alternative Loans include credit lines, short-term loans, microloans, equipment financing, and merchant cash advances. These loans provided by finance companies allow borrowers to determine their criteria within the boundaries of federal and state laws. Generally, interest rates are reasonable.
  4. Fast Track Lenders give business loans to small business owners by offering secured financing options nationwide. FTL helps small businesses by ensuring they have options for long term financing solutions, through providing access to flexible capital.
  5. Commercial Acquisition Loans are used to buy a business initially.
    These quick loans offer financing in a few months, even if buyers are unable to use capital to purchase a business or franchise directly.

Additional loan options are available for Wholesale Businesses. We recommend contacting us to discuss more options such as the ones below:

  • Business overdraft
  • Term loan
  • Peer-to-peer Business Loan
  • Business credit card
  • Invoice Financing
  • Business Vehicle Finance
  • Equipment Lease
  • Impact-linked Financing

As a distributor, you must be able to sell your manufacturing client’s inventory. As a wholesaler, you are responsible for completing purchasing and supplying what your retailer clients want. A small business loan will help any business achieve exactly the goals necessary for success.

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