You’ve given it a lot of thought and you’ve decided that it’s time to walk away from your 9 to 5 and start your own business. If your goal is to open your own retail store, you have a lot of preparation ahead of you. Of course, as with any other business, you need to start with a business plan and decide whether you plan to bring along a partner or do it yourself. Then, you need to consider your options for financing.
One of the most daunting parts of starting a new business is finding capital. Please know that you’re not alone. There are lots of ways you can get the financing you need to open a retail store. You will most likely need to take out a loan for all or part of the money you need, so make sure you include principal and interest payments on your business plan.
In this article, we’ll explore some of your options for business loans to open your retail store.
Costs Associated with Opening a Retail Store
First of all, when you are planning to open a retail store, you need to consider the costs involved:
Lease/rent (6 months’ worth)
Security deposits
Licensing/permits
Insurance
Location improvements
Equipment
Utilities
Inventory
IT costs
Attorney fees
Accountant fees
Marketing/advertising
Market research
Employee salaries
Miscellaneous
It’s important to remember that start-up costs vary greatly and can fluctuate based on location, business plan, and industry. You may need a few thousand to over $100,000 to open your retail store.
Business Loan Options for Opening Your Retail Store
When you are looking for a business loan to open your retail store, you should know that you have several options. From using business credit to providing personal collateral, you need to carefully review your options before you commit to a long-term loan.
Here are some of your loan options for opening your retail store:
SBA 7(a) Loan
Microloan
Real Estate Loan (CDC/504)
Personal Loan
Of course, these loan options typically have credit score requirements. What if you have bad credit or no credit? Do you still have options? Absolutely!
Bad/No Credit Financing Options
If your credit score is under 600, you may have difficulty obtaining the funding you need, so you will need to seek alternative options. These include:
Alternative loan
Fundraising/Crowdfunding
Home Equity Loan
Retirement Account Rollover
Family/Friends
Credit Cards
Angel Investors
Bottom Line
No matter where you choose to secure the funds to start your retail store, it’s critical to choose the option that fits your needs. If you have a good credit score and equity in your home, a loan may be a good option. However, if you have bad credit or nothing, you may want to set up a fundraising campaign. Either way, we can help you get the financing you need for your retail store. Contact WCK Financial today to learn more.