Holiday Sales Make up Huge Percentage of Annual Revenue

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pic-1If you operate a business in one of the sectors that have their busiest time of year during the holidays, such as retail, you no doubt are starting to prepare for the coming weeks as Christmas and the New Year period gets closer.

Have you ever sat down though and done the numbers on how much of your annual sales you earn during the holidays? If not, you might be surprised to find out that it can account for as much as 30 percent; and that it resulted in $626.14 billion in sales in the United States alone last year. The National Retail Federation also predicts that holiday sales will grow this year. The organization expects to see an increase of 3.1 percent (more than $19 billion) in retail sales this coming 2016 season.

To take full advantage of this time of year then, many businesses consider taking out a loan in order to stock their shelves for the rush, hire more staff to serve customers, or otherwise cater to demand. In fact, according to a recent survey, 4.3 percent of small business owners expect to borrow money over the holidays.

However, according to the same survey, over 37 percent of these same entrepreneurs are not confident that they will be granted a loan from a bank if they apply for one. As such, it’s incredibly important for owners to know the best ways of going about getting holiday cash for a small business so that they don’t miss out on taking advantage of the prime sales period.

If you’re keen to get access to funds over the coming weeks, read on for some tips you can follow to increase your chances of success.

Consider Multiple Lenders to Find the Right Fit

The first thing you need to do to get a good loan is ensure that you do your research. There are, after all, lots of different loan types and lenders out there these days, which means you no longer have to use only the bank you currently have accounts with, or the institution located right down the road from you office.

If you want to get the best deal for your venture, it’s important to search for the right fit instead. This will not only mean that you submit a loan application with a company more likely to approve it, but that you also source a better rate. Keep in mind that different lenders often have very different rules and requirements when it comes to their loans, so some firms wouldn’t even consider approving your application while others might come back with a “yes” within mere hours.

When you’re conducting research for potential lenders, examine not just the standard banking institutions, but also boutique online lenders, crowdfunding sites (such as Kickstarter and Indiegogo), niche lending alternatives (like those who specialize in retail clients or those in the education sector), and other alternatives.

pic-2Ensure Your Financial Paperwork Is in Order

Another incredibly important thing you must do if you want to get a loan approved quickly is make sure that all of your company’s financial paperwork is up to date and in order before you submit your application to a lender.

Generally all lending institutions, no matter their size or type, will ask to see the financial records of a business (such as current accounts, tax returns, and sales projections) before they will approve a loan. Many organizations will also ask to see details of the business owners’ personal records as well, especially if the venture is new and without much in the way of trading records, or if the owners need to put up their own assets as collateral.

Lenders ask for this information because they need to feel secure that any business they loan funds to is a good financial risk. They want to be sure that they will receive payments on time, and with interest, and that the management of the company is reliable. Updated financial records and tax data will typically be the first things they ask to see to demonstrate this.

Provide a Detailed Business Plan

Lastly, you will also find that most banks, and a variety of other types of lenders, will also request a detailed business plan as part of their application process. If you want to get a loan quickly and easily and enjoy the best interest rate possible on the loan, you will need to present lenders with an updated, comprehensive plan that shows you have put a roadmap in place for your venture’s future.

An effective business plan will demonstrate that you’re clear about your firm’s goals, mission, and value; that you have conducted plenty of research on your competitors, target market, and industry opportunities and threats; and that you have carefully calculated your sales and/or profit projections. It also pays to include information about what you plan to use the additional funds for if you receive the loan, and how this injection of cash will provide a monetary benefit for the business over time.

Melissa Thompson writes about a wide range of topics, revealing interesting things we didn’t know before. She is a freelance USA Today producer, and a Technorati contributor.