Restaurant Business Loans

Restaurant Business Loans Can Help Your Business

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How a Restaurant Business Loan Can Help Your Business

In the food industry – or any business industry, for that matter – there can be good days and there can be bad days. What determines a good or a bad day is not always clear, and it is definitely not predictable. Despite the unpredictability, your business always is going to have to pay expenses and fun day-to-day operations.

Another factor to consider is growth; but, while expansion opportunities offer long-term sustainability, they definitely take working capital to get started.

A restaurant business loan can help you make it through slow periods of business, and can help you seize growth opportunities to maintain and expand your restaurant business.

SMB Compass is dedicated to helping our clients’ businesses grow, by providing you with the funding you need. We handle your financial concerns, so that you can focus on what truly matters: serving your customers with delectable meals that will keep them coming back for more.

Whether you want to expand your existing store or branch out, restaurant business loans can help you cover the expenses. Whether you need funds for expanding, purchasing equipment, or hiring new employees, a restaurant business loan can help you during successful times, or cover your payroll or expenses to vendors during a seasonal slump.  

If a refrigerator, oven, stove, or another piece of equipment suddenly needs to be replaced or a repaired, a restaurant business loan provides a quick solution. With readily available cash, you can purchase new equipment and keep your business running.

SMB Compass understands the challenges of running a restaurant. That’s why we’re committed to working with you through the good times and the bad to help you attain the funds you need to survive and to thrive.

Best Ways to Use a Restaurant Business Loan

Running a restaurant is a lot to deal with. Business owners know that restaurant businesses are some of the most stressful organizations to run. While this may be true, managing a restaurant can also be extremely gratifying – personally and profitably.

If you have a reputable funding partner, that believes in your business’ potential, you will be set up for success in the restaurant industry. At SMB Compass, we will work with you to find a restaurant business loan that perfectly fits your needs.

Here are some of the ways you can use the funds from a restaurant business loan:

Improve Marketing

If you don’t have an established online presence, your restaurant will definitely miss out on business opportunities. Having a mobile-friendly, content-rich website and social media presence will improve your online profile. More of a presence online  means more potential customers will notice your brand, despite being in a competitive market.

Creating a fully-functional website with advanced ordering capabilities, real-time order status updates, and integrated customer reviews doesn’t come cheap. A restaurant business loan can help you cover the expenses of developing a website and establishing a strong online presence.

Renovate / Expand Your Restaurant

A restaurant business loan is ideal if you’re looking to renovate, repair, or expand your restaurant to make it look more presentable, and more profitable.

Expanding your restaurant means more room to seat and serve more customers daily. Improving the kitchen and storage means that business operations become more organized and efficient, which results in fewer mistakes, faster orders, and happy customers.

Invest in Marketing & Advertising

Almost every business from every industry has a website. But having a website isn’t always enough. In order to generate desirable results, you need to create a user-friendly, search engine-optimized, fully functional website. A retail business loan will help you cover the costs of hiring the best website developer for your business.

Purchase New Equipment

Your once-new kitchen equipment will eventually need costly repairs. By applying for a restaurant business loan, you will have the funds to purchase new equipment, or repair old ones. You can even use the equipment you’re going to purchase as collateral, depending on the type of loan you apply for.

You can also use restaurant business loans to:

  • Upgrade point-of-sale systems
  • Open new locations
  • Purchase additional inventory
  • Hire new employees
  • Pay for operating expenses
  • Payroll and taxes
  • Refinance existing debt
  • Overcome unexpected business expenses
  • Improve advertising and marketing efforts

How Long Does Restaurant Financing Take?

SMB Compass offers quick approval for your restaurant business loan. Our company has provided more than $160,000,000 to small businesses all over the country. We will work closely with you to make sure all of your needs are taken care of.

We offer fast and flexible funding. In four easy steps, your business will receive the funding you need:


Apply for a restaurant business loan online

Our simple online application lets you fill out and submit your request for funding. The process is pretty simple, but if you need help along the way, you can contact us via phone, chat, or email.


A friendly 5 to 10-minute introduction

The next step is an introductory conversation with one of our account executives. We will go over your needs and begin to discuss the different options available.


Documentation and underwriting

Once you make a decision and reach an agreement, we’ll provide closing documents to review the terms. We’ll also answer any final questions you might have.

Approval and funding in less than 24 hours

When your loan has been approved, we immediately send the funds to your business bank account within 24 hours.

Best Types of Loan Programs for Restaurant Loans

SMB Compass offers different types of financing options for your restaurant business needs. To make sure that your business gets nothing but the best, our trusted financial advisors will help you find the right loan, based on your restaurant’s specific needs and goals.

Here are the most common types of financing for restaurants/bars:

SBA 7(a) Loans

The Small Business Administration (SBA) began incentivizing lenders to fund small businesses by guaranteeing a certain percentage of loans that they offer to small businesses. This makes an SBA loan ideal for small business owners that are seeking financing for their restaurant.

An SBA loan can be used to improve marketing efforts, add a new location, or make it through an off-season. There are not strict restrictions as to how business owners can use the funds, so an SBA loan can cover most business expenses. SMB Compass will work with you to set competitive terms, rates, limits, and repayment schedules that suit your business’ needs and goals.

Equipment Financing

Equipment financing provides your business with funding to purchase any kind of machinery or equipment you need to keep your business going. Whether it’s a new laptop, a van, oven, or maybe water-refilling machines, equipment financing will get you through. With equipment financing, the equipment you buy serves as the collateral that secures your loan. There are typically two options for equipment financing: equipment loans and equipment leasing.

Business Line of Credit

A business line of credit is structured similarly to a credit card. Lenders set a maximum credit amount, and your business only has to pay for the amount you withdraw (plus interest). For example, if you are approved for a $100,000 line of credit, and you’ve only spent $20,000 in the first month, you only need to pay the $20,000 and the interest.

A business line of credit is also revolving. This means that once you pay toward your amount owed, your amount available increases.

The terms of a line of credit are based on three factors: personal credit, business credit, and cash flow. Because this type of loan is not secured by collateral, potential lenders typically want to see strong cash flow and a good operating history. If you can show an excellent credit profile and strong cash flow, there’s a great chance that the terms and rates of your loan will be attractive.

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:

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

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.