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Hotel Business Loan

Hotel Business Loan Can Help Your Business

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How a Hotel Business Loan Can Help Your Business?

Running a hotel business may seem fancy on the outside, but the truth is that it’s a constant juggling act. Whether it’s a franchise, or a small bed and breakfast, every hotel business needs a dedicated, attentive staff and a meticulous manager.

The goal of every hotel business – or every business, for that matter – is to enhance overall customer experience and gain new clientele along the way. However, the strategies your business implements to achieve this goal have to be cost-effective, limiting the amount of debt and expenses incurred.

Hotel business owners and managers often consult lenders to see how a hotel business loan can help take their business to the next level.

SMB Compass offers hotel business loans that could help cover the costs of renovating, expanding, or bolstering customer acquisition efforts, just to name a few possibilities. Our trusted advisors will have a discussion with you about how to improve the value of your business’ assets.

At SMB Compass, we understand the challenges of running a hotel. That is why we’re committed to working with you through the good times and the bad to make sure you have the working capital you need.

 

Ways to Use a Hotel Business Loan

It’s not easy to run a hotel, but if you have a reputable funding partner that believes in your potential, you can have a shot at success. Just like any other business, hotels can use the help of extra working capital to maintain business operations.

Here are some ways to utilize funds from a hotel business loan:

Create a Mobile-Friendly Website

Did you know that more than 50% of hotel bookings are done online? A business without a website loses tons of potential business opportunities.

But, having a website isn’t enough. Mobile-friendly websites are in high demand, not just in the hotel industry, but in every business industry. Travelers and tourists use their phones to access information and book hotels.

Customers prefer hotel websites that display real-time pricing, room availability, and general hotel information. However, a fully functional, search engine-optimized, mobile-friendly website often comes with a high price. You can use hotel business loans to cover the costs of creating websites or apps for your hotel.

Advertising and Marketing Campaigns

Advertising and marketing campaigns are an important part in customer acquisition, especially if you’re a newly-built hotel. If your hotel doesn’t have enough funds to invest in creating top-notch advertising and marketing campaigns, a hotel business loan can help you out.

Upgrade Hotel Equipment

There will come a time when your business will need to replace or repair your hotel equipment, such as furniture, fixtures, door lock systems, point-of-sale systems, food service and laundry carts, washers and dryers, and beds. Purchasing hotel equipment all at once is not cheap. A hotel business loan will help pay for the needed equipment without disrupting cash flow.

Business Expansion or Renovation

Are you considering renovating your hotel to keep up with emerging trends? Are you looking to add more rooms to accommodate more customers? Or, are you considering opening up a souvenir or gift shop inside your hotel?

Whatever the reason, expansion and renovation often require a substantial amount of cash. A hotel business loan will help you pay for your business’ expansion without draining your bank account.

Best Types of Loan Programs for Hotel Business Loans

SMB Compass offers different types of financing options for your hotel business needs. We have financial experts on hand, ready to help answer any question to make sure you find a loan product that fits your needs.

Here are the most common types of financing products for hotels:

hotel business loan

SBA 7(a) Loans

The Small Business Administration (SBA) gives incentive for lenders to offer loans to small businesses by guaranteeing a percentage of the funds immediately. This makes SBA loans ideal for small businesses.

The SBA 7(a) loan is also ideal for hotel financing because it has low-interest rates, long repayment terms (10 to 25 years), and you can borrow up to $5,000,000. The SBA 7(a) loan is flexible, and you can use it to fund any hotel financing need, such as purchasing commercial real estate, construction, renovations, equipment purchasing, additional working capital, and more.

Asset-Based Loans

If your business doesn’t have enough revenue or cash flow to qualify for other forms of business financing, you might want to look into asset-based loans. Asset-based loans are ideal for businesses with a high value in assets or on their balance sheets.

Businesses can use their assets as collateral to secure financing. Most lenders consider the following as collateral for an asset-based loan:

  • Accounts Receivable
  • Inventory
  • Equipment
  • Intellectual Property
  • Real Estate
  • Marketable Securities
hotel business loan
hotel business loan

Merchant Cash Advance

A merchant cash advance is a good option if your hotel business needs working capital ASAP, or if you don’t have good credit. Technically, a merchant cash advance is not a loan; as the name suggests, it’s more of a cash advance.

With a merchant cash advance, lenders provide you with the funds you need in exchange for a percentage of your daily credit/debit card transactions. While a merchant cash advance isn’t a loan, it still offers similar benefits. It also has a higher approval rate than other traditional loan programs.

Equipment Financing

Buying new equipment for your hotel is expensive. Equipment financing provides you with the money you need to purchase new beds, washers and dryers, vehicles, or any other equipment your hotel needs. Typically there are two equipment financing options: equipment leasing and equipment loans.

hotel business loan

Interested in learning about your financing options?
Speak with a lending expert today!

Interested in learning about your financing options? Speak with a lending expert today!

Best Types of Loan Programs for Hotel Business Loans

SMB Compass offers different types of financing options for your hotel business needs. We have financial experts on hand, ready to help answer any question to make sure you find a loan product that fits your needs.

Here are the most common types of financing products for hotels:

hotel business loan

SBA 7(a) Loans

The Small Business Administration (SBA) gives incentive for lenders to offer loans to small businesses by guaranteeing a percentage of the funds immediately. This makes SBA loans ideal for small businesses.

The SBA 7(a) loan is also ideal for hotel financing because it has low-interest rates, long repayment terms (10 to 25 years), and you can borrow up to $5,000,000. The SBA 7(a) loan is flexible, and you can use it to fund any hotel financing need, such as purchasing commercial real estate, construction, renovations, equipment purchasing, additional working capital, and more.

hotel business loan

Asset-Based Loans

If your business doesn’t have enough revenue or cash flow to qualify for other forms of business financing, you might want to look into asset-based loans. Asset-based loans are ideal for businesses with a high value in assets or on their balance sheets.

Businesses can use their assets as collateral to secure financing. Most lenders consider the following as collateral for an asset-based loan:

  • Accounts Receivable
  • Inventory
  • Equipment
  • Intellectual Property
  • Real Estate
  • Marketable Securities
hotel business loan

Merchant Cash Advance

A merchant cash advance is a good option if your hotel business needs working capital ASAP, or if you don’t have good credit. Technically, a merchant cash advance is not a loan; as the name suggests, it’s more of a cash advance.

With a merchant cash advance, lenders provide you with the funds you need in exchange for a percentage of your daily credit/debit card transactions. While a merchant cash advance isn’t a loan, it still offers similar benefits. It also has a higher approval rate than other traditional loan programs.

hotel business loan

Equipment Financing

Buying new equipment for your hotel is expensive. Equipment financing provides you with the money you need to purchase new beds, washers and dryers, vehicles, or any other equipment your hotel needs. Typically there are two equipment financing options: equipment leasing and equipment loans.