Business loans are not just for those that want a business.  Restaurant loans can be used in many creative ways at any stage a business may find itself in to help that business get back on track. Here, we’ll review two different stages businesses may encounter, and the best ways to use a loan on each occasion.

Fledgling Stage: For banking and lending institutions the fledgling stage is anywhere from 1 to 3 years old. This accounts for several things that help them decide how much money the bank will lend a business and whether or not a business will be eligible for restaurant loans. It tells them that a company hasn’t been in business long enough to be considered for a large sum of money unless said business can provide verifiable proof of a means of payback. Banks generally tend to only lend money to those that pose a low-level risk, but because they require so many different qualifications, it is not an option available for many.

The best restaurant loans choice for the fledgling stage: In this case, a bank may not even look at you once. They have floods of business owners that are begging for bank loans. This can be discouraging, but a MCA or Merchant Cash Advance loan (as we’ll refer to it) is the best one for this type of business. You’ll still have to prove that you’ll be able to pay it back but this type of loan is more flexible because it is like a credit card with its revolving line of credit as opposed to a traditional loan.

Established Stage: This stage, to lenders is anything over 5 years.  We still wouldn’t recommend bank loans at this stage or really any stage unless you are in an expansion mode, have become a large chain, etc. and each of your restaurants being in business for 5 years in great standing. Banks take a lot out of businesses and you spend your whole career trying to pay your restaurant loans back. The MCA loan is one that will take the equity found in your assets and will complete a nice equipment loan. This means you can pay it back against your equipment. Or, you can still go the route of the payback from an agreed upon percentage of profits; it’s up to you and your lender.

Things to use the loan for:

Update that Menu! If you’ve been touting the same poached salmon for a year, maybe some more fresh fish and you’ll top the charts for the best fresh fare in town. Or what about the total overhaul of that menu? Put out some comment cards so the patrons can tell you what they want and go from there!

Expand into another restaurant: Have you done so well that you want to expand and open another restaurant? Have you found the perfect spot but don’t know how to go about it? Take the leap!

Expand your Staff: Are you so busy that you need extra staff? Then a MCA loan is one of the best restaurant loans to have for business expansion. Hire who you need, when you need them.

Add a delivery service: Delivery services can be just what you need to serve all kinds of customers. Take a chance and see how your business will flourish.