Every savvy car wash owner and operator reviews ways to increase revenue and drive new business. Partnering with the right finance company and using financing effectively can greatly impact the success of your business. Let’s review three critical ways that financing can be used to positively impact your bottom line and what questions you should ask your finance company. We’ll consider these strategic uses of financing in the car wash industry:
1. Point-of-sale system upgrades
2. Business expansion
3. Increase efficiencies
The new standards in processing credit cards to meet security regulations can put a significant burden on operators and owners. The need to upgrade the technology for credit card and point-of-sale (POS) systems can range from acquiring hand-held devices to multi-use computer tablets and terminals. Finding a finance partner that can finance both the new hardware and software will benefit the business owner.
What to Ask
When discussing your POS financing needs with your lender, ask if they offer zero down payments. This will mean you can acquire the necessary equipment and technology with no out of pocket or upfront costs which can positively impact your cash flow.
As an existing car wash operator, you may be looking to expand your business by purchasing additional locations or expanding your existing car wash location. This means that the equipment at the new locations will need to be upgraded. Traditional bank financing usually provides funds to borrow for the new property, but will not cover the entire expansion project, including upgrading the existing equipment.
What to Ask
Ask your commercial lender if you are able to finance new, used, or refurbished equipment with them and what age restrictions may apply to specific pieces of equipment. Some financial institutions will not finance used equipment. Ensure you choose a financier that provides you with flexible asset options.
Finding ways to save time, money, and resources is a critical way to drive additional income. This can be done in many ways including installing remote security systems; replacing outdated equipment with newer, revenue-producing equipment; or upgrading software and technology.
What to Ask
Will financing equipment or technology affect your business credit line with your current bank? Using alternative financing like leasing can protect your lines of credit with traditional banks.
This means you can acquire the items your business needs to stay competitive while you maintain your credit line for business emergencies. Additionally, ensure you have access to a 100 percent financing program. This means you can also finance soft costs associated with equipment acquisition including shipping, tax, installation, and other expenses.
ADDITIONAL SOURCES OF FINANCING
Navigating the maze of financing options can be difficult and challenging. When partnering with the right finance company, you should also have options available to you and your business for working-capital needs. Working-capital lines of credit or short-term business loans can provide you with critical cash to run your business and take advantage of last-minute opportunities.
What to Ask
Does your finance company offer working-capital or short-term small business loans? Working capital loans can be an effective finance tool used to buy equipment but may also be used for virtually any business need including payroll, marketing campaigns, inventory, and other initiatives.
Curt Newsom is senior vice president of sales – car wash with Ascentium Capital, a national direct lender that specializes in financing for the car wash industry.
For more information, you can contact Curt at (281) 902-1939 or via e-mail at CurtNewsom@AscentiumCapital.com.