- Looking for working capital to help grow your business?
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- Does your business accept credit or debit cards for payments?
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Car Wash Loans
Opening a car washing business in Canada can be a fantastic opportunity that offers a continuous source of revenue from repeat customers. As your clientele grows, the volume of business your car care facility will experience grows, too. But, there is one significant drawback that prevents many ambitious business owners from launching a Canadian car washing operation. The initial investment to purchase a facility and prepare it for daily use can be substantial. Most people need outside financing to buy the property and start the business.
Car washing businesses can vary by the level of service. While some are full-service operations, others are coin-operated or “drive throughs.” Each requires a large amount of start up capital. In this article, I’ll describe a few standard forms of financing for a Canadian car wash operation. I’ll also explain an alternative form of financing that you may not have considered.
Finding Financing For Your Car Washing Business
Launching your car wash business requires a considerable amount of money. The facility you need to wash cars can cost up to $500,000 or more. Plus, the day to day operation of your car care business requires additional cash flow for tools, materials, employees and other expenses. Whether you’re planning to launch your operation in Calgary, Winnipeg, or Vancouver, you’ll likely need financing.
Most banks will encourage you to apply for a typical business loan. While being approved for a car wash loan will give you access to the money you need to launch your business, the process can be frustrating.
Potential Drawbacks Of Traditional Loans
Banks throughout Canada have a systematic method for approving business loan applications. This process typically includes running a credit check, reviewing your business plan, measuring the likelihood of your operation’s success and your ability to repay the loan. Often, car wash loans that are offered by your bank will require a sizable amount of collateral. For example, you may be asked to back the loan with a secondary mortgage on your home.
While that may not present a problem when business is good and your monthly revenues are healthy, the economy in Canada can take a turn. If it does, your business may suffer and revenues may decline. Because car washing enterprises can require a significant amount of cash flow to operate, meeting the monthly payment obligation of a traditional business loan may be difficult. Ultimately, this can expose your collateral to risk.
Using A Canadian Merchant Cash Advance
A relatively new financing option is a Canadian merchant cash advance. It’s becoming an increasingly popular form of obtaining working capital. This is largely due to a business cash advance being less-maintenance to acquire and manage. Applying for a business loan at your bank can involve an excruciating approval process while the bank studies your marketing plan, financials and credit report. By contrast, a business cash advance can be available for your use within a few days.
Nearly every type of business in Canada needs some form of financing. The money may be needed to purchase a large facility, buy supplies, pay salaries, or invest in inventory. Flexibility is essential. One of the benefits of a Canadian business cash advance is that your use of the capital is not restricted. You can allocate the cash flow as you see fit for your company. When it’s time to search for an accommodating car wash loan, explore how you can benefit from a merchant cash advance.
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Are you currently accepting payments using credit or debit cards at your business? If so, we can probably help you find the money you need fast. Apply Now!