Funds for refinancing debt, working capital, and more

Working capital

Working capital is used to cover a company's short-term expenses like inventory, equipment, marketing, payroll, hiring, and payments on short-term debt. The formula to calculate working capital is: Deduct current liabilities (primarily short term loans due within a year and accounts payable) from current assets (cash on-hand and things that can be easily converted into cash, like inventory and accounts receivable). If your current assets don't exceed your current liabilities, a bank term loan can get you back on track to help meet financial obligations and cover day-to-day business expenses.

Debt refinancing

Many entrepreneurs rely on expensive debt when launching or in the early stages of their business. If those debt obligations are cutting into cash flow, refinancing can help you save big. For example, a marketing consulting company in San Francisco was making excessive monthly loan payments. The owner took out a $100,000 Bank Term loan with better terms and lower rates from a bank in the SmartBiz network. He was able to refinance three high cost loans, saving the business approximately $7,000 monthly.

Hiring employees

A bank term loan can cover costs related to hiring like recruitment, training, salary, and benefits. An automotive business in North Carolina needed additional workers to keep up with service demand. The business owner allocated $15,000 from a bank term loan to hire and train 2 new technicians. With the additional staffing, he'll be able to take on more jobs, increasing revenue.

Purchase equipment

Business equipment includes tangible property (other than land or buildings) used for operations. Examples include computers, machines, tools, and vehicles. A frozen food wholesaler allocated $60,000 from a Bank Term loan to replace outdated refrigerated equipment. The business now has reliable cold storage to handle current and future inventory.

Marketing

A bank term loan can finance marketing efforts to build your brand, attract customers, and increase sales. Consider a Bank Term loan from a bank in the SmartBiz network to cover things like advertising, trade show costs, promotional materials, and more. For example, an established beauty salon is using $10,000 from a bank term loan to revamp their website, invest in Google pay per click ads, and launch social media campaigns.

Inventory

If you need to increase existing inventory or expand your product line, funds from a bank term loan can cover the costs. The owner of a cafe in California is using loan proceeds to purchase additional coffee and tea products. They'll save big by buying goods in bulk.

Construction

If you need funds for remodeling, bathroom updates, or other space improvements, consider a Bank Term loan from a bank in the SmartBiz Loans network. A restaurant located in Atlanta came to SmartBiz to solve a problem. Demand for their food was high, but their available dining space was too small. The business owner took out a Bank Term loan to expand into a space next door. The funds are being used to hire a contractor/engineer along with a designer to handle aesthetics. The projected additional revenue per day due to the larger space is $1,000- $1,500 per day.

Partner buyouts

A buyout is where one party purchases shares of a business to acquire a controlling interest in that company. Funds from a Bank Term loan from a bank in the SmartBiz network can finance this type of transaction.

Business acquisitions

Funds from a bank in the SmartBiz network can be used to purchase an additional business. However, funds cannot be used for a new business purchase. If you have questions, please ask your SmartBiz Loans relationship manager for specifics.