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LOCATION & INDUSTRIES

Best Seasonal Business Loans and Financing

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By Erin Ryan Social Community Manager, Senior Writer and Editor at Fast Capital 360 Reviewed By Mike Lucas
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Loan Overview

  • Coins stacked on table with blue arrow pointing up
    Loan Amount Up to $500,000
  • Calendar image appearing as though the page is being flipped
    Estimated Repayment Terms 1-5 Years
  • Speedometer icon
    Interest Rate Starting at 7%
  • Dollar sign in circle
    Speed of Funding As fast as 1 day

Is a cash-flow shortage making it difficult to prepare for your busy season?

If you’re a seasonal business owner, you’ve likely needed an influx of working capital at one time or another, and might again at some point. With that in mind, here’s a list of some of the top funding available to seasonal businesses.

Financing Your Seasonal Business for Success

Unless you’ve got a hefty cash reserve, it might be a challenge to pay for inventory, market your business or hire staff during slow periods. Let’s take a look at how seasonal business financing can help you earn positive net working capital.

Stock Up on Inventory

Get ready for your busy season: Buy the inventory you need to ensure maximum profitability. Whether you need to order snowboarding equipment for your ski shop or decorations to sell in your holiday store, stocking inventory can prove costly. However, having enough inventory is vital to capitalize on sales during your business’s peak season.

Promote Your Seasonal Business

As you lead up to your busy season, you might want to spend money advertising your business, either on the radio, in local circulars or on billboards. Your goal is to get as many people in the door as possible. The higher the foot traffic, the higher the potential for increased revenue.

Keep in mind, marketing your business can be costly and may not be an expense you’ve budgeted for. You see the return on investment, though. As such, you’re open to financing the cost if it can lead to increased sales.

Hire Seasonal Help

As you’re ramping up for the busy season, you’re going to need staff. Hiring workers costs money, which you might not have available before the season kicks off. Because of the nature of seasonal businesses, staff is often transient — meaning you may not have the same group of workers at your ready year after year. You also might need to spend money advertising open positions. A seasonal loan could provide the extra funding you need to open your doors for business.

Keep Up with Year-Round Monthly Payments

Even in low revenue months, there are certain bills that remain constant — rent, utilities, insurance, etc. When money is only flowing out of your business, not in, times can get tough. A loan can help with the financial management of a seasonal business during the in-between months.

Plan for Unexpected Expenses

Unanticipated expenses arise all the time, and some you just can’t put off. A roof leak, a burst pipe, an unexpected tax bill, can all leave you scrambling to find the funds you need fast. Certain seasonal business financing options are available quickly, as fast as 1 day of approval with some lenders. Just what you need when an emergency crops up.

How Much Can My Business Qualify For?

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Best Financing and Loan Options for Seasonal Loans

A seasonal loan, by definition, refers to financing that can be repaid according to a business’s peak season and cash flow.

Let’s look at the top seasonal business financing options:

Business Line of Credit

If you’re in need of seasonal working capital, consider a business line of credit. If approved, your lender will determine your credit limit. You don’t have to access your credit until you need it, and you don’t need to use all your funds at once. Plus, you only pay interest on the amount you borrow.

What’s more, many business credit lines are revolving. That means your credit line is restored as you make payments, up to your original credit limit.

Business lines of credit are an option if you’re in need of temporary working capital and don’t want to be limited by how you can use the funds. Minimum credit score requirements for business lines of credit often range from 550-575.

There are a couple of business lines of credit:

Secured Credit Lines

This type of financing involves offering collateral, which reduces the risk to the lender. If you default on the funding, the lender has the right to collect the assets you’ve provided as security to recoup losses. Secured lines of credit often have lower interest rates and higher credit lines than unsecured lines.

Unsecured Credit Lines

Unsecured lines of credit usually have shorter repayment windows, higher interest rates and lower credit limits than you’d find with a secured credit line. That’s because borrowers don’t offer any collateral to secure their debt, which creates more risk for the lender.

Business Credit Card

For a seasonal business owner, a company credit card can provide short-term financing when you need it. As with a personal credit card, the lender provides you with a credit card and you’re granted a credit limit. You can tap into this credit line when you need it and pay it down monthly. Note that business credit cards might impose a fee for cash advances, a fee typically waived with business lines of credit.

Do you need a loan for your small business?

Short-Term Loan

Prepare for your busy season by taking out a short-term loan. Short-term loans are often meant to be repaid in less than 18 months. This can vary depending on the lender, however. For instance, some short-term loan terms may require payment in as little as 3 months, while others may require payment in several years.

Additionally, your payments may be weekly or daily instead of monthly. Depending on the lender, you may be able to qualify for a short-term loan with a minimum credit score of 540. Short-term funding could be offered up to $500,000, with some lenders offering higher loan amounts.

SBA 7(a) Loan

If you’re looking to renovate your seasonal storefront, need to purchase inventory or are seeking working capital, consider a 7(a) loan backed by the Small Business Administration (SBA).

While the SBA doesn’t actually lend borrowers money, it does guarantee the lender a certain percentage of the funds borrowed, which puts less risk on the lender. For loans less than $150,000, the SBA guarantees 85%. The agency guarantees 75% for loans greater than $150,000, up to a maximum of $3,750,000 per borrower. Loan limits can’t exceed $5 million and repayment terms are typically 10 years, though they may extend up to 25 years.

  • In the 2018 fiscal year, the SBA approved nearly $25.4 billion in 7(a) funding, which accounted for more than 60,000 loans.

SBA Express

While the approval and funding process for a 7(a) can take 3 months, the SBA Express process is designed to take about 30 days. Funds are limited to $350,000, of which the SBA insures 50%. Repayment terms may be 5 years or 10 years. Additionally, interest rates are generally higher than those offered through 7(a) loans.

SBA Seasonal CAPLine

If your seasonal business has been in operation for at least 1 calendar year, you could be eligible for a line of credit guaranteed by the SBA. Approved borrowers can use Seasonal CAPLine funds to finance increases in inventory and accounts receivable due to your business’s seasonality. In some instances, increased costs associated with hiring workers may also be considered an eligible expense. Borrowers may be approved for up to $5 million, and repayment terms can extend to 10 years.

Merchant Cash Advances

For those looking for quick access to cash who have a credit score in the 500s, consider a merchant cash advance (MCA). An MCA is an advance on your future sales.

If approved, a lender provides funds that are paid back with a percentage of your anticipated credit- and debit-card sales.

Repayment is based on a factor rate, a percentage often expressed as a decimal figure (e.g., 1.14). To calculate repayment, you would multiply the factor rate by the total amount advanced. Payments often are made daily, and can fluctuate based on your daily sales. Repayment terms vary, and may range from 3 months to 18 months.

Estimate terms for every type of financing

Loan qualifications

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    Time in Business 1+ Year
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    Annual Revenue $200,000+
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    Credit Score 560+

Loan qualifications

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    Time in Business 1+ Year
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    Annual Revenue $200,000+
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    Credit Score 600+

Loan qualifications

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    Time in Business 1+ Year
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    Annual Revenue $75,000+
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    Credit Score 540+

Loan qualifications

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    Time in Business 2+ Years
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    Annual Revenue $160,000+
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    Credit Score 620+

Loan qualifications

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    Time in Business 1+ Year
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    Annual Revenue $150,000+
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    Credit Score 600+

Loan qualifications

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    Time in Business 4+ Months
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    Annual Revenue $100,000+
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    Credit Score 500+

Loan qualifications

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    Time in Business 2+ Years
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    Annual Revenue $50,000+
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    Credit Score 650+

Loan qualifications

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    Time in Business 1+ Years
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    Annual Revenue $75,000+
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    Credit Score 540+

How much do you need?

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    This is an estimation tool that provides a range of possibilities depending on creditworthiness and terms selected. Terms can be adjusted to increase or decrease your payment. To see all our loan calculators click here.

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      Total Repayment:
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      This is an estimation tool that provides a range of possibilities depending on creditworthiness and terms selected. Terms can be adjusted to increase or decrease your payment. To see all our loan calculators click here.

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      This is an estimation tool that provides a range of possibilities depending on creditworthiness and terms selected. Terms can be adjusted to increase or decrease your payment. To see all our loan calculators click here.

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        This is an estimation tool that provides a range of possibilities depending on creditworthiness and terms selected. Terms can be adjusted to increase or decrease your payment. To see all our loan calculators click here.

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          This is an estimation tool that provides a range of possibilities depending on creditworthiness and terms selected. Terms can be adjusted to increase or decrease your payment. To see all our loan calculators click here.

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          This is an estimation tool that provides a range of possibilities depending on creditworthiness and terms selected. Terms can be adjusted to increase or decrease your payment. To see all our loan calculators click here.

          How much do you need?

          Estimated Factor Rate

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          This is an estimation tool that provides a range of possibilities depending on creditworthiness and terms selected. Terms can be adjusted to increase or decrease your payment. To see all our loan calculators click here.

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            Total Repayment:
            Cost of Loan:
            This is an estimation tool that provides a range of possibilities depending on creditworthiness and terms selected. Terms can be adjusted to increase or decrease your payment. To see all our loan calculators click here.

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            Estimated Interest Rate

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            Loan Term

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            Total Repayment:
            Cost of Loan:
            This is an estimation tool that provides a range of possibilities depending on creditworthiness and terms selected. Terms can be adjusted to increase or decrease your payment. To see all our loan calculators click here.

            Where to Find Seasonal Financing

            Seasonal loans are available through banks and credit unions as well as online lending marketplaces.

            Let’s take a look at the differences between these financing providers:

            Conventional Banks

            If time is on your side and you have an established business and good credit, financing through a conventional bank could be your best route. Banks generally offer lower interest rates and longer repayment terms than online lenders.

            To apply for a seasonal loan with a conventional bank, you might be required to demonstrate the following:

            • Minimum credit score of 650, according to Experian
            • Collateral
            • Financial documentation (1-3 years could be required)
              • Tax returns
              • Bank statements
              • Profit-and-loss statements
              • Cash flow statement and projections

            Online Lenders

            If a quick approval process is paramount, consider pursuing funds offered through an online lender. Online lenders often boast easy application processes and quick access to funds.

            Also, the requirements generally are more lenient than you’d experience with a conventional bank. As a trade-off, you’ll likely pay higher interest rates and have shorter repayment windows than you’d find with conventional banks. However, if you’ve been in business for less than a year, have poor credit and no collateral, this might be an option.


            What You Need to Apply for Seasonal Financing or a Loan

            Application requirements vary by loan and lender. However, at Fast Capital 360, we have financing options available for borrowers meeting the following minimum criteria:

            • Speedometer icon FICO Score 500 +
            • Cake icon Time in Business 4 months
            • Chart icon Annual Revenue $100,000

            To get started, you’ll need to provide:

            • Basic details about yourself and your company
            • 4 most recent monthly bank statements

            Apply With Fast Capital 360

            Ready to apply for seasonal working capital? It’s easy to get started. Here are some of the benefits of working with Fast Capital 360.

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            Save Time

            In just a few minutes, you can apply for funding on our secure site. What’s more, you could receive financing preapprovals in less than 24 hours.

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            Get Multiple Financing Offers

            We partner with reputable lenders throughout the country to offer you the financing that supports your company’s needs. In fact, you could receive preapprovals from up to 20 lenders, so you can compare various financing options for your seasonal business.

            icon-expert-advice

            Receive Expert Advice

            Finding the right funding for your business can be challenging, but it doesn’t have to be. With Fast Capital 360, you’ll have a dedicated Business Advisor to assist you throughout the loan application and funding process. Your Business Advisor will explain your financing options and terms so you can make an informed choice.

            One application. Multiple loan offers.

            Quickly compare loan offers from multiple lenders without impacting your credit score.

            GET APPROVED
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