Business Loans for Public Houses
Cash is the lifeblood of any business, but from time to time businesses can face a shortage of the cash they need to carry out expansion plans or fund day to day operations. A business loans for Public Houses can make up that cash shortfall, providing the fuel required to set a business back on the road to growth.
Business loans can be one of the most common forms of finance available to business. They take the form of a lump sum of cash which is released to the business, usually by a bank, and then repaid over a fixed period of time.
Because small and medium sized businesses like Public Houses usually don’t have access to the debt and equity markets – in other words, they can’t issue bonds or stocks – business loans are much more commonly used by SMEs than by large corporate companies.
Business loans for Public Houses can be used to borrow from as little as a few thousand to over a million pounds and repayment terms can range from 6 months to ten years or more. A business loan might be unsecured, like a personal loan, or secured against some asset owned by the business or business-owner e.g. a property.
Alongside banks, business loans can be offered by specialist business finance providers and peer-to-peer lenders. Interest rates offered depend on a variety of factors including the lender, the financial health of the borrowing company, whether the loan is secured against an asset and the prevailing market conditions.
Business loans might be taken out for a variety of reasons including, but not limited to:
- Purchase of assets like buildings, plant or equipment.
- Purchase of additional inventory to take advantage of an anticipated busy period e.g. Christmas.
- To alleviate a cashflow shortage caused by seasonal effects, business expansion or changes to the business cycle.
Business loans for Public Houses can offer a number of benefits to SMEs when used for hospitality business expansion. They can be arranged with a fixed rate of interest so that repayments are known and can be incorporated into business forecasting. They have fixed terms so the date when repayments end is known and they are generally cheaper than other forms of business financing.
It should be noted however that business loans should not be used to finance ongoing losses. If a business model has fundamental problems then those problems should be addressed before seeking finance – the interest costs of a loan can merely exacerbate them.
Have a Public House and looking for a business loan? complete Business Loans for Public Houses Contact Page.