A successful lawn care company requires specialized equipment that can cost tens of thousands of dollars. However, the industry is highly seasonal and cash flow can be erratic. With the right financing solution, a landscaping company can avoid financial hardships that can be caused by a slow season. Oftentimes, small business owners turn to banks for funding but can be turned down due to stringent requirements. Other options include credit cards, but these have high interest rates that can hurt the company. Fortunately, several small business loans for lawn care exist. These provide the needed funding and support to ensure that your lawn service company can grow.
What are the Best Small Business Loans for Landscaping?
The small business landscape is crowded with different lenders, and many of them offer financing to small businesses. Generally, traditional lenders offer competitive rates and terms but may require substantial collateral or a strong credit score to qualify. Some also take a long time to approve and deposit funds. Alternative lenders, on the other hand, offer a variety of different financing products and are able to fund your business quickly. They are a good option for landscaping companies that need a larger amount of funding but cannot meet the eligibility requirements for SBA or bank loans.
Working capital loans can be a great tool for helping a lawn service company with their day-to-day operations, including invoicing, employee payroll and inventory. These loans can help with seasonal fluctuations that may affect your revenue or if you’re planning to expand your business.
This type of business loan offers a more flexible payment schedule than other types of lending. For example, you can choose to pay only a certain percentage of each month’s invoice total. This is especially useful for lawn care businesses that experience seasonal dips in revenue.
Equipment financing is a type of business loan that allows you to buy the specialized equipment your lawn service needs to be successful. Unlike other types of loans, this type of funding is easy to qualify for because the equipment itself serves as collateral. In addition, it can be obtained by people with poor or fair credit scores.
Gap financing is another type of business loan that provides funds to cover temporary cash shortfalls. This is a good option for lawn service businesses that have hired new employees but are waiting for them to generate sufficient revenue. It’s also helpful for businesses that have a slow season and need to keep the payroll running in order to avoid layoffs.
Business lines of credit are a popular financing solution for landscaping businesses. They can be obtained from both conventional lenders and alternative lenders and function much like a business credit card. You can access the funds whenever you need them up to the credit limit, and you can re-borrow as your balance goes down. At Crestmont Capital, we offer a variety of flexible MCAs that can help your landscaping business with its short-term financing needs.