Choosing the right finance for your restaurantJune 7, 2017
Running a growing restaurant is a full-time responsibility. It takes talent, dedication and stamina to manage it effectively. Restaurant goers are notoriously picky and you must excel beyond their expectations in order to survive in this highly competitive industry. You must keep an eye on presentation, source outstanding quality ingredients, fine tune your customer service, revamp your decor and make sure your finances can support both your restaurant’s current and future situations.
Understandably, balancing your attention between these key areas can be strenuous. You can try creating a detailed to-do list, but when you’re in the thick of it, you’ll often find your attention being pulled elsewhere. However, the one area you can’t afford to overlook is your business’ access to external finance.
With high street banks turning away from SME businesses, the alternative finance industry is quickly becoming the preferred choice among restaurant owners. One of the most common reasons many restaurants close is due to financial troubles, outlining the necessity for external funding. Alternative lenders provide a diverse array of different packages allowing you to raise capital and secure high-quality equipment. Often beating your local high street bank for speed and efficiency, alternative finance is a fantastic resource for ensuring your restaurant’s growth and sustainability.
A superb restaurant demands outstanding talent and customer service. In order to provide high-quality dishes for your customers, your kitchen staff must possess proven skills and be able to demonstrate a flair for taste, creativity and presentation. Your food should be what defines your restaurant, make your customers shower you with nothing but praise.
Yet even if you have the best food in the world, it will count for nothing if your customer service isn’t immaculate and finely tuned. It can be easy to overlook the importance of high-quality customer service, but when restaurant goers can share online reviews in an instant you can’t afford to let your standards slip. From point of order to the moment they leave your premises, how your staff engage and treat customers can make a huge difference.
Restaurants are often defined by the types of dishes, spices and styles they deliver. Sometimes it may even be just a single dish that becomes your signature. What does matter is that your customers know what to expect, even if your regulars choose the same dish every time. Consequently, effective management of your inventory is imperative, essentially boiling down to supply and demand. If your customer’s order is out of stock they may well choose to take their business elsewhere. Nor do you want to be in a situation where you’ve overstocked on ingredients for dishes that aren’t as popular as you initially thought. To avoid calamity, consider installing Electronic Point Of Sale (EPOS) devices and software, where one of the many benefits include easy inventory management. Some of the products on the market include EPOSnow, EPOS Systems Ltd and Wowpos.
Although it’s great when you’ve got tried and tested dishes that have become a staple among your customers, sometimes it’s great to escape your comfort zone. Whilst also offering regular dishes why not experiment and create new additions to your menu? Testing new variations of your existing dishes can have a number of positive affects on your restaurant. It’s a great way of engaging new customers whilst also reviving the adoration among your existing customers. Plus, boost morale in your kitchen by allowing your team to try new ideas and add their own flair to each dish they produce.
At the heart of every commercial kitchen is your catering equipment. Kitting out your kitchen with the highest quality equipment available allows you to maintain and boost your restaurant’s ability to compete in your local area. It will allow you to go above and beyond your customers’ expectations, enticing them back time and again. And, of course, it can be used as your restaurant’s unique selling point (USP), doing wonders for your PR. Naturally, getting the equipment your restaurant needs can be expensive, but don’t let costs hold you back; the alternative finance industry can help.
When it comes to satisfying your customers you’ll often find that your premises and customer service go hand in hand. Restaurant goers want to head to a place where they can relax and immerse themselves in an atmosphere to suit their tastes. Of course, it’s impossible to suit every taste, so appeal to your core customer demographic and bring your restaurant into the 21st century. Consider whether your need to add new furniture, a change of decor or even if you need to expand your current facilities. Whatever your premises needs, the alternative finance industry can help.
Alternative business finance is a useful tool to consider when you run a restaurant. With fast access to additional capital and equipment, all supplied by an extensive array of business finance products, there’s no limit to how far your restaurant can go. But with thousands upon thousands of business finance solutions available, finding the solution that fits your restaurant perfectly can be overwhelming. That is why more and more restaurant owners are choosing to source finance with Rangewell. With our services and expertise, you can acquire everything, including business loans, leasing agreements, hire purchase solutions and much more!
If you’re considering a business loan there are two types to be aware of: Secured and Unsecured. To apply, lenders must be able to review aspects such as your Credit History and Credit Score.
With an unsecured loan, you could acquire a lump sum of between £5,000 to £250,000, all without the need to lay down assets as security. However, if you need to get hold of a larger sum you could offer potential lenders a personal guarantee.
Meanwhile, with a secured loan you can bestow upon your business a lump sum starting from £5,000 to as much as £1,000,000. With this type of loan, you are required to put forward assets as security. Should your business become unable to keep up with the monthly repayment scheme or fail to pay entirely, lenders can claim these assets to recoup costs.
Leasing agreements allow your business to have the use of new equipment, typically, for a period lasting between from 1-5 years. When discussing leases you need to understand the two types available:
Operating Lease: With this agreement, you utilise the asset for a portion of the asset’s projected working life. Responsibilities such as maintenance, repairs, registration and so on remain with yourself unless you have taken out a separate agreement with the equipment supplier to cover these aspects. At end of the term generally, you’re free to either extend the lease or hand back the asset. It’s also possible that the lessor will extend an offer allowing you to purchase the asset in question at the end of the leasing period subject, of course, to their terms and conditions
Finance Lease: Again, you’ll be required to commit to a monthly repayment scheme. But this time the term can cover most of, if not the entire, lifespan of the asset concerned. You will also be required to accept certain responsibilities regarding maintenance, repairs, registration, administration and so on. Once the agreement has elapsed you are free to return, extend the agreement or possibly purchase the asset from the lessor subject, of course, to their terms and conditions
Merchant Cash Advance:
With this option, your business could receive a lump sum within 48 hours of applying, based solely on your monthly credit and debit card sales. In order to qualify, your business must support card-based sales and be able to produce, on demand, 3 or more of your latest consecutive sales reports. Plus, what makes this such an appealing finance solution for many business owners is that there’s no need to provide your credit score as this isn’t taken into account. This finance solution works by a lender offering to purchase your expected takings for one month, otherwise known as ‘receivables’, at a discount. But what makes this product truly unique is the repayment scheme. Unlike the typical business loan, where you pay a fixed lump sum each month, Merchant Cash Advance takes a percentage of your potential monthly sales. For example, a lender could propose a percentage in the region of 18% for each of your card sales, which can also be described as 18p from every £1 your customers spend. Because of this, the repayment scheme is one of the most flexible in the finance market and means that if your sales go down during one particular month the amount you have to repay for that month is reduced, and vice versa.
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At Rangewell our services are clear and transparent. We support a wide range of SME businesses of every shape and size, for finding every type of finance. Follow us on Twitter and LinkedIn for business tips and tricks, and feel free to call us on 0203 637 2340 if you’d like to chat about what we can do for you.
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