Complete Guide to Grocery Store Loans
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- Get funds as fast as 24 hours
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Loan Overview
- Loan Amount Up to $500,000
- Estimated Repayment Terms 1-5 Years
- Interest Rate Starting at 7%
- Speed of Funding As fast as 1 day
In the U.S., grocery store sales are nearly $683 billion, according to Statista, and that isn’t to mention convenience stores, of which there are more than 150,000 throughout the country responsible for an additional $235 billion.
Competing with recognized, established grocery and convenience stores can be challenging, particularly if you lack the capital you need to promote your brand and build a solid customer base. That’s where a grocery store loan can help.
Why Apply for Grocery or Convenience Store Loans
Whether you’re managing through a temporary downturn in business, want to expand or simply don’t want to tap into your cash reserves, a grocery store business loan can help with anything of the following needs and more.
Hire Staff
Could your store benefit by having an additional team member, one you’re currently lacking? Hiring the right talent can be a costly expense, but one that could be financed. Keep in mind, grocery store managers in the U.S. average slightly less than $81,000 annually in pay, according to Salary.com, while assistant managers average about $57,830. Additionally, grocery store clerks earn nearly $22,650 on average.
Buy Inventory
A convenience store might have an inventory of several hundred stock keeping units (SKUs), while a grocery store likely has several thousand. If you’re looking to replenish your supply, a bulk purchase could be pricey, but it’s necessary when you sell food and drink staples. A grocery or convenience store loan could provide the capital you need to restock your shelves and backroom.
Purchase Equipment
When equipment breaks down or it’s time to upgrade, grocery store financing is an option for what could be a rather large purchase. Use funds for any of these (and more):
- Signage
- Freezers
- Coolers
- Shelving
- Shopping carts
- Delivery van
- Point-of-sale systems
- Merchandise displays
Invest in Marketing
Marketing your grocery store or convenience store isn’t just about circulars and outdoor signs. Today, many business owners are investing in creating loyalty programs as well as expanding their reach online, not only with a website but also with email marketing and mobile applications.
Pay Rent
On the lower end, let’s say your lease costs you $1.50 a square foot a month. If you have a 2,000-square foot space, roughly the size for a convenience store, that would equate to $3,000 a month.
Obviously, with grocery stores, the price just goes up because of larger spaces. On the smaller end, grocery stores could be 12,000 square feet. Larger ones could range from 50,000 to 140,000 square feet. The dollar signs can add up quickly.
Open Another Location
Is business going so well that a second location is viable? A loan to buy a convenience store or grocery store could help you grow. You could also use financing to secure a lease for new retail space.
Estimate terms for every type of financing
Loan qualifications
- Time in Business 1+ Year
- Annual Revenue $200,000+
- Credit Score 560+
Loan qualifications
- Time in Business 1+ Year
- Annual Revenue $200,000+
- Credit Score 600+
Loan qualifications
- Time in Business 1+ Year
- Annual Revenue $75,000+
- Credit Score 540+
Loan qualifications
- Time in Business 2+ Years
- Annual Revenue $160,000+
- Credit Score 620+
Loan qualifications
- Time in Business 1+ Year
- Annual Revenue $150,000+
- Credit Score 600+
Loan qualifications
- Time in Business 4+ Months
- Annual Revenue $100,000+
- Credit Score 500+
Loan qualifications
- Time in Business 2+ Years
- Annual Revenue $50,000+
- Credit Score 650+
Loan qualifications
- Time in Business 1+ Years
- Annual Revenue $75,000+
- Credit Score 540+
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Top Grocery Store Loans and Financing Options
Here are some options to consider when you’re in search of small business loans for your grocery store or mini-mart.
Short-Term Loan
When your funding needs are temporary, a short-term loan could be the best type of financing for your grocery store. Repayment often falls in the 3-18 month range and payments are often daily or weekly.
Business Term Loan
If you’re looking to spread out your payments over a longer term, a business term loan could be a better option. You could use funds for pretty much any business need, not limited to refinancing debt, hiring more employees, financing a major equipment purchase and more.
SBA Loan
Loans backed by the Small Business Administration (SBA) are a good option if you’re unable to qualify for a conventional bank loan. SBA loans have competitive interest rates and terms. Use funds for working capital, real estate, equipment, inventory financing and more.
Business Line of Credit
A business line of credit is a flexible form of financing. Instead of being given one lump sum of money, you’re approved for a certain credit line amount. Similar to a credit card, use the credit line when you’d like. As you pay off your debt your credit line is restored up to the original approval amount. Use funds to pay rent one month, cover operating expenses and more.
Equipment Financing
If you want to buy a new piece of machinery or technology, an equipment loan can make that possible. Often, with an equipment loan, the item serves as collateral for the loan, so in many cases, you could be approved for the full purchase price.
Merchant Cash Advance
If you have poor credit by bank standards and need funds fast, a merchant cash advance is another option to consider. To offset their risk, lenders require shorter repayment terms and higher rates than other funding types. Also, this type of financing often requires daily payments automatically deducted from a business’s bank account.
Where to Find Convenience and Grocery Store Business Loans
There’s no shortage of lenders when it comes to business loans for convenience store owners and grocers. However, the differences between them are many.
Conventional Lenders
Banks and credit unions are often the first institutions that come to mind for business and personal loans. After all, they are often able to offer competitive interest rates and terms. That said, the requirements to qualify for funding can be difficult for many small business owners to meet.
Alternative Lenders
These nonbank lenders offer easy online applications and fast approval and funding. Business owners who’ve been turned down by conventional lenders, many times still need financing. That’s when some turn to alternative lenders. Although payment terms are generally shorter, repayments more frequent, these lenders offer other options for fast access to funding.
What You Need to Apply for Grocery Store Business Financing
With Fast Capital 360, convenience or grocery store owners can apply for business funding by meeting the following credit score and revenue qualifications:
Minimum Requirements:
- 500 or higher FICO score
- 6 months in business
- Annual revenue of $120,000 or more
What You’ll Need to Get Started:
- Basic information about your business and yourself
- 6 most recent monthly bank statements
Apply with Fast Capital 360
At Fast Capital 360, we have a track record of helping business owners finance their dreams or weather dips in sales. Here’s how you’ll benefit from working with us.
Quick and Easy Application
Complete our simple online application In just a few minutes.
Multiple Offers
Because we partner with lenders throughout the country, your application could return several financing offers.
Expert Advice
A Fast Capital 360 Business Advisor will review your funding offers with you so you can make the best decision for your company’s needs.
One application. Multiple loan offers.
Quickly compare loan offers from multiple lenders without impacting your credit score.
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