The United States is home to more than 33.2 million small businesses, according to Oberlo. Markets are competitive, and each year some businesses fold, but many also thrive. In order to succeed in competitive markets, many businesses take out startup loans. These loans offer entrepreneurs resources, which in turn can be used to build up their companies. Keep reading to learn more about this option.
The Basics
Running a business takes resources. Once a company is established, it can use incoming revenue to pay employees and for inventory, equipment, and more. Yet for businesses just starting up, revenues often aren’t coming in. That’s where startup loans can help. They can provide startups with the crucial resources needed to set up shop.
Later, once the business is humming, entrepreneurs can use revenues to pay down loans and support various business processes and ambitions.
Getting the Resources Your Business Needs to Grow
Small business loans can provide crucial resources. It’s hard to run a business, even a really small one, on your own. Many businesses need to hire employees, but how can you do that if you’re not yet generating income? Folks with substantial savings can tap into their personal wealth, but many Americans lack the means to do so. With a loan, you can secure the financial breathing room needed to hire staff members.
Of course, employees may need equipment, tools, uniforms, and more. Even purchasing a few laptops can quickly run up a hefty bill. While some startups may try to bootstrap operations, using older computers and skipping things like dedicated office space, many companies will still need to invest substantial sums.
Many businesses will also need to build up inventory. In some cases, suppliers may extend credit, allowing entrepreneurs to pay for goods later. However, this isn’t always feasible, and small businesses may need to invest upfront in inventory and other assets.
Given how competitive markets are, advertising and marketing can prove crucial as well. Yet running an effective marketing campaign can easily cost thousands of dollars. With a small business loan, entrepreneurs can fund marketing campaigns.
Applying For Small Business Loans
The Small Business Administration offers a number of loan programs, including SBA 504 and SBA 7(a) loans. In many cases, you can apply for loans online. Indeed, over 30% of small business applicants chose online lenders when looking for funds in 2022, according to Fundera. Given how busy entrepreneurs often are, applying online can speed up the process and make the whole process easier to manage.
Now that you understand how startup loans work and how they can grow your business, it’s time to start the application process. Contact our team here at MCDC today for assistance! We look forward to working with you.