In today’s somewhat shaky economic climate, running a small business can be tricky, though some industries seem to be able to weather even the worst economic depressions—and the liquor industry finds itself at the top of that list. Owning and operating a liquor store can be more stable than other businesses—and for those who are interested in spirits, it can be an extremely enjoyable job. Getting things off the ground can be a challenge, though, and the more you know about liquor store financing, the smoother running that business will be.
Because liquor stores tend to do well in a variety of economic climates, it’s not uncommon for banks and alternative business lenders to be more willing to lend and provide liquor store loans to those looking to expand an existing store or to open an additional store. Business loans for liquor stores are also attractive to borrowers: they usually allow for quicker funding, lower interest rates, smaller down-payment and long-term amortization.
Finding the right small business lender can be a challenge: you want to get the best terms and conditions possible. For this reason, searching the Internet and compiling a list of lenders that specialize in liquor store financing is essential. and you should never just go with the first lender you come across, without evaluating your options.
Before you apply for a business loan for a liquor store, you need to decide exactly what you will do with the loan proceeds, so consider the uses of proceeds below.
First is inventory, which you should expect to turn over approximately eight to ten times per year. For this reason, it’s important to determine from the start whether you want to “go big” or carve out a niche as a specialty liquor store, which should depend upon the market that you’re serving. This will help you determine how much capital will be needed for inventory financing. Just remember that there’s more to spend money on than simply inventory, so don’t use your entire liquor store loan just to stock the shelves.
Next, you should start thinking about ways in which to get people through your doors. If the space isn’t up to par, renovations may be necessary, which can be quite costly and should always be handled by a professional contractor. Marketing is also essential: this is what will get people to notice your new store. Print and radio ads can be effective, but they’re very expensive. Digital marketing via social media and a local web presence through local SEO is key to spreading awareness, and you can accomplish this with minimal investment.
The payoff for owning and operating a liquor store can be substantial if you play your cards right. It takes a great deal of planning and a lot of hard work to find success. Start by focusing on your financing options and using your money wisely.
Fundation has experience providing funding for those in the beverage industry, including liquor stores. Contact us for more information on conventional, fixed rate term loans that can provide you with the liquor store funding you need to take your small business to the next level.
Fundation combines the benefits of a bank loan with the ease and efficiency of an online lender. We offer conventional loans with competitive rates to businesses with varying credit profiles. Our technology allows us to deliver capital in as few as 3 business days through streamlining the collection and evaluation of customer information and conducting the majority of the lending process electronically. As a direct lender, we use our own capital to originate and hold the loans we make, so that we can focus on building relationships with our customers. Our dedicated customer relationship model enables us to understand each unique borrower’s business. This level of service, coupled with our best-in-class products, is why many of our customers come back to us repeatedly for more capital.