The automotive repair is a strong industry with $70 big in revenue.
However, you will find significant cost for operating a car repair center for example equipment which can be costly, inventory to satisfy ongoing demand, as well as licensing and regulatory requirements.
The overhead in an auto repair shop is fairly constant. It always only rises during busy periods when supplies and parts are essential. But when times are slow the overhead won't drop proportionally.
This is how auto repair center financing can help.
When to think about a small business loan for the auto repair shop
There are many reasons why you might need a business loan for example a good investment which will grow your business or extra money to ensure you are able to meet your immediate financial obligation.
Here are the more common reasons auto repair center owners seek financing:
Ensure Consistent Cash Flow
Purchase Inventory
Payroll, taxes, fees
Expansion
Increase workforce
Purchase or repair equipment
Auto Repair center Business Loan Options
There are some different business loan or funding options available to auto repair shops. All these may be viable choices for you if you've been in business several years, have a very good credit score, show consistent income, as well as your annual revenue is strong.
Business Type of Credit
A business type of credit is really a flexible funding option which gives you access to funds when you need them, as much as your approved amount. You only pay the premium and interest on the part of money that you withdraw.
Requirements: Six months in business; minimum personal FICO of 620; minimum annual gross revenue of approximately $300K.
You could be approved as much as $250k.
Term Loan
A Term Loan is a practicable option for a car repair shop owner seeking a more traditional loan. Terms range from two to five many make it easy for you to definitely borrow capital and repay it inside a short time. With a term loan you could get funding within a month, which is much quicker than the usual traditional bank.
Requirements: 2 years in business; minimum personal FICO of 640; must own a profitable business
You could be approved as much as $200k.
SBA Working Capital Loan
An SBA Capital Loan may be one of the best funding options for small businesses. The reason – It's a government-backed loan, partially guaranteed through the Small Business Administration (SBA). While these financing options are not as easy for small businesses to qualify for because of tighter requirements.
Requirements: 2 years in business; minimum personal FICO of 650; must own a profitable business
You can be approved as much as $350k.
Working Capital Advance
A Working Capital Advance typically have a greater cost and shorter term which is why this method is viable if you have poor credit score, have been in business a short period of your time, or need funding quickly. With this kind of advance you can have funding within Three days.
Requirements: Six months running a business; minimum personal FICO of 500; minimum annual gross revenue of approximately $180K.
You could be approved as much as $500k.
Bank Loan
A traditional bank loan will require higher qualifications in terms of time in business, credit score, and annual revenue. You will also need collateral to secure this loan and process to receive funding will take a minimum of two months. If approved a financial loan has a tendency to have a lower interest rate and longer term options.
Auto Repair Shop Equipment Financing Option
Equipment, just like a portable exhaust extraction system, within an auto repair center requires a beating daily. There is constant maintenance that has to be done. This takes time and money. Fast financing provides fuel to keep this machine going.
When you do not have the cash on hand, equipment financing will allow you to finance as much as 100% the price of the equipment purchase, up to the lender's maximum. The purchased equipment will then be utilized for collateral.
Where to Get Auto Repair Shop Financing
A repair center owner doesn't have the time to bother with finding money to repair equipment in order to hire a new skilled mechanic. Small Business Funding often help auto repair center companies that have trouble getting funding from a traditional bank. We can provide access to fast and hassle-free financing.
Check your eligibility and see what funding options you may qualify for today.
Grants for Auto Repair Shops
While there aren't any specific grants for automotive repair centers, there government, State, or corporate grants you may be eligible for a that could be utilized for your specific business.
Unlike a business loan, grants do not need to be repaid. However grants are available with specific guidelines that you simply are required to follow. If you're awarded a grant and do not spend the money based on the rules, then there will be penalties and you'll be required to pay back the entirety of the grant.
Here are a few non-specific use grants which you can make an application for:
National Association for that Self-employed (NASE)
You must be part of the NASE to apply for this small company grant worth as much as $4,000. The NASE award grant to small business for financing a particular small company need. Past winners used their grant money for purchasing equipment, hiring staff, advertising, and much more.
Amber Grant
The Amber Foundation Grant is especially for women-owned businesses. The awarded grant is worth $4,000 and can be used for any business-related need such as equipment, marketing, or inventory.
Idea Cafe Small company Grant
The Idea Cafe Small company Grant is awarded towards the business most abundant in innovated idea. Business will get a $1,000 grant.
Intuit Love Our Local Business
A $25,000 grant is awarded towards the winner of the Intuit’s Love Our Local Business competition. The competition lets fans, including customers, vendors, employees, and also the community, determine who will receive this small company grant.
A lot of research and energy goes into finding and trying to get a small business grant. And the grant process is lengthy, and you may not really be awarded the grant. But should you qualify, this is your best option for funding, since a grant does not need to be repaid.