About Jewelry Business Financing
Jewelry comes in a wide assortment of materials, styles, and costs, creating a range in the amount of capital necessary to run the business. Despite their differences, however, online jewelry businesses share the need to pay the upfront costs that come with the supply chain. Materials, manufacturing, packaging, shipping, and warehousing are all necessary and costly. Many businesses aren’t capable of keeping up with all the fees and charges that come with this process and growing at the same time. That creates a need for jewelry business financing to help sellers keep their cash flow positive.
Your business shouldn’t be struggling to maintain a steady supply of product — it should be growing and meeting new goals. In addition to regular costs, lack of proper forecasting, dips in the economy, and fluctuating trends can make it difficult to execute a strategy, especially without necessary funding. Jewelry business financing will increase your cash flow, so you can keep your warehouse stocked and your customers happy.
Jewelry Business Financing Opportunities
As you start your search for jewelry business financing, you may feel overwhelmed with all of your options. There are many things to consider when choosing a funding partner, as well as the type of financing you need. Before applying for financing, however, be sure to minimize costs where you can, optimize your budget, and get clear about your priorities. Then, you’ll be able to choose a loan that will fit your business needs and help you reach your goals. Here are some of the best types of financing for jewelry businesses.
Bank loan
When you take out a bank loan, you obtain a large sum of money from a bank to pay for business-related expenses. You can usually use the loan to pay for any business costs you choose, from expansion costs to inventory procurement to marketing. It’s a good option for those who can afford to meet the large monthly payment and are eligible to receive the funds.
Bank loans tend to have lower interest rates than other forms of financing since you’re considered a low risk investment after meeting all of their strict requirements. Collateral isn’t required for most of these loans, but it does depend on your unique situation. Some banks ask that you provide collateral if your credit score isn’t high enough or if your current revenue is too low.
This loan type is very hard to obtain, however, as banks often require that you have a high credit score and lengthy trading history. The application process is long and tedious, so make sure that you have a good chance of being approved before filling out all of the paperwork. You can schedule consultations with loan officers in order to determine your current eligibility.
Revolving line of credit
A revolving line of a credit is a useful type of funding to have, as it can cover day-to-day costs, last-minute orders, or emergency expenses. Similar to a credit card, you’ll gain funds as you pay off the money you take out. You’ll have consistent access to cash, which every business owner can appreciate. However, revolving lines of credit are not meant for large purchases due to their tendency for low credit limits.
This loan type is relatively easy to obtain, as it has more lenient eligibility requirements than a bank loan. It’ll help you boost your credit history, so you can apply for a better loan down the line. You have the freedom to use the funds when and how you want, as the lender doesn’t control your spending schedule unlike with other loan types.
Lenient requirements can mean that you’re considered a high risk for the lender. You’ll need to compensate for this by paying higher interest rates. The borrowing limit is on the lower side, too. As long as you plan to use it for smaller costs, it’s a loan that can benefit your business. Be sure to read your contract carefully, as many lenders like to add hidden fees.
Merchant cash advance
If you own a business that needs cash quickly, then a merchant cash advance may be able to help you. The repayment schedule is flexible; you can choose to meet a large monthly payment or offer a percentage of your future debit and credit card sales until the loan is repaid. This is helpful for businesses that struggle to meet a fixed monthly payment. The quick funding will increase your cash flow, so you can keep up with demand.
The eligibility requirements of a merchant cash advance are very lenient, so many businesses that struggle to qualify for other types of funding can obtain one. You don’t need to have a great credit score or a long trading history in order to be approved for a merchant cash advance. You simply need to show that you bring in regular revenue through credit and debit card transactions. Collateral isn’t required, so you won’t have to risk your business assets, either.
On the other hand, this loan type isn’t going to boost your credit score. Merchant cash advances are also often more costly than other types of funding too, so keep that in mind when applying. Be sure to read your contract carefully so you know how your payments work and are aware of any fees that may apply.
Inventory financing
If you’re in need of inventory, then this loan type might be for you. Your inventory financing will be secured with collateral, which is the inventory itself. Startups and mature companies alike can benefit from this type of funding, as everyone needs a stocked warehouse in order to meet demand.
Inventory financing usually has lenient requirements and lower interest rates. The application process tends to be quick, so you can receive funding within days. You’ll be able to stock up on inventory, prepare for new product lines, and get ready for spikes in demand and seasonal sales.
The lenders may perform regular evaluations on your goods, so be sure to keep accurate records to expedite this process. In addition, inventory financing often has a loan minimum that can be too costly for some businesses to meet. Other times, you won’t receive the full amount you need, so you’ll need to determine if it’s the right option for you.
Invoice financing
If you’re a business with outstanding invoices, you can sell them to a factoring company in exchange for fast cash. They’ll buy them at a discount, providing you with up to 90% of the funds quickly. They’ll then collect the outstanding invoices from the clients directly, according to the client’s payment terms.
With invoice factoring, you’ll obtain funds much more quickly than you would have waiting for the client to make the payment, which can take months. The factoring company’s cut may be more cost-effective than interest on a regular loan, too. However, you’ll have to consider which one is more beneficial to your company.
Before signing an agreement with a factoring company, keep in mind that they tend to charge extra fees, so read your contract carefully. Each factoring company is unique in their loans and guidelines. If the client fails to pay the invoice to the factor, then you may have to repay the factoring company yourself, but this will depend on your agreement.
Revenue-based financing
When bank loans and other types of financing aren’t an option for your business, you can turn to revenue-based financing. This is a viable option for you as long as your business brings in consistent revenue. You’ll repay this type of financing with a percentage of your future sales revenue, making it a great option for businesses with fluctuating revenue or even seasonal sales. This typically doesn’t have a time limit, as it depends on the sales volume.
Revenue-based financing usually has a quick application process, and you’ll get access to funds quickly. You won’t need to go through credit checks or extensive business evaluations. You’ll also retain full ownership of your business.
There are of course downsides to revenue-based financing too. It often has a higher cost of capital than other types of financing, and only businesses that have a history of bringing in steady revenue are eligible. If you’re a newer business that doesn’t yet make sales revenue, you’ll have to look elsewhere.
Business grant
A business grant is a sum of capital that businesses can receive from private organizations, the state, or the federal government. You won’t have to repay the funds that you receive, but they will likely dictate when and what you spend the money on. This is a good option for startups that don’t qualify elsewhere and those that can’t afford to repay their financing.
The main benefit of a business grant is that you don’t have to repay the funds. It’s essentially free money with some guidelines you have to follow in order to use it. Successfully obtaining a grant will also increase your credibility as a business.
While the pros are many, grants are very difficult to obtain. Most grant-giving bodies give funds to a specific type of business or business owner in order to further goals or objectives. If you don’t fit their requirements, there’s no point in applying. What’s more, the application process is usually long and tedious, and competition is high. If you are approved, this loan is only a short-term solution, because it won’t provide you with the consistent cash flow you need for long-term growth and success.
8fig: An Alternative for Jewelry Business Financing
Banks and other funding providers often have strict eligibility requirements and repayment guidelines that can hold promising businesses back from growth. 8fig is a financing solution designed by eCommerce experts for eCommerce sellers. We understand the unique challenges that online jewelry businesses face, and therefore our funding solution is often a better fit for such businesses. With more lenient eligibility requirements, fast and flexible funding, and free growth tools, 8fig may be the answer you’re looking for.
Why use 8fig for jewelry business financing
8fig provides online jewelry businesses with the financing and tools you need to achieve your growth goals. The key to growth is consistent cash flow, which 8fig offers alongside flexible payment schedules. You’ll be able to optimize your budget with continuous capital injections aligned to your supply chain and even change the details as you go. With these benefits, you won’t have to worry about falling behind.
How 8fig works
1. Apply
The application process is fast and easy. Answer some questions about your business and sales, and then provide basic information about your supply chain stages and expenses.
2. Connect your store and bank account
In order to provide you with an optimized Growth Plan, 8fig requires that you connect your store and bank account to the 8fig platform.
3. Get funded
With 8fig, you can get funded in just days. Since 8fig funding is continuous, you receive capital infusions into your business right when you need it.
4. Make adjustments
If something changes and you need to adjust your payments, remittance schedules, or even funding amount, you can always do so thanks to 8fig’s flexibility.
5. Grow your business
All that’s left to do is sell, sell, sell. With 8fig, businesses are able to scale 2.5x as fast.
What 8fig offers in addition to financing
8fig offers much more than a great financing solution. You’ll be able to use our advanced growth tools to optimize your cash flow, plan your supply chain, track sales, and predict demand all on one platform. With capital, tools, and resources at your fingertips, you’ll be able to plan, fund, and manage your business.
The all-in-one growth platform that 8fig provides will enable to map your supply chain and manage your schedule with ease. With these key details taken care of, you’ll be able to concentrate on the bigger picture, meeting goals faster than you would have thought possible. 8fig will be with you throughout the entire process, as an experienced business partner.
Who is eligible for 8fig jewelry business financing
8fig’s application process is quick and simple in comparison to most other banks and funding providers. You can receive funds in days, rather than weeks or months—which can be too late if you’re struggling to keep your business afloat. If approved, you can get funds that cover up to 90% of your supply chain expenses.
All 8fig asks is that you have at least 12 months of trading history, generate $100,000 or more in annual sales, and have made an average of $8,000 in monthly revenue for the last three months.
How to apply for 8fig financing
It’s easy to apply for 8fig financing, and it only takes a few minutes. Simply answer the questions and follow the prompts and you’ll get funded in no time!