November 19, 2021

Juice Bar Financing: How to Best Use a Loan

Juice bar business owners are no exception, and as government stimulus dries up, many will need to consider pursuing juice bar financing. In order to start a juice bar or continue selling freshly squeezed, cold pressed juices, you'll need ample cash flow. Of course, you don’t have to be struggling to pursue and utilize juice bar funding; many business owners are ready to grow their existing operations. With an infusion of capital, you can expand your product lines, hire more workers, or open a new location, to name a few examples. Whether you’re struggling or thriving, though, successfully financing your business is easier said than done. In the sections below, you’ll find information about juice bar financing options and how to put your money to work. The juice bar industry can be a lucrative one, and we'll explain how to make the most of your financial opportunities.

4 Financing Options for Juice Bar Owners

How you finance your juice or smoothie bar depends on your goals, financial history, and business performance. Due to this, it’s important to consider multiple juice and smoothie bar financing options before you select one. Below, we'll review common small business financing options that you may want to pursue:

1. SBA Loans

These types of loans belong to an SBA-administered loan program. The loans in the program most suited to juice bar owners are the SBA 7(a) loans and SBA 504 loans. While both 7(a) and 504 loans are slow to fund and require lots of documentation, they have very competitive rates.

2. Term Loans

This is a traditional loan that can be used for a wide variety of juice business expenses. With a term loan, you receive upfront cash and pay back your loan over a specified period. Keep in mind that while term loans from traditional and alternative lenders are structured the same, they’re very different. Typically, a term loan from an alternative lender is much easier to qualify for but slightly more expensive than a traditional term loan.

3. Equipment Financing

If you only need funds to cover equipment costs, equipment financing is worth considering. With this type of financing, the lender uses the equipment as collateral to secure the loan. This makes equipment loans easier to qualify for because secured collateral mitigates the lender’s risk. Read more about the pros and cons of equipment financing.

4. Non-loan Financing Options

Juice shop loans aren’t the only way that business owners can finance their shop; there are many other financing options that aren’t technically loans. These options include:
  • Merchant cash advances
  • Equipment leasing
  • Lines of credit
  • Credit cards
  • Angel investors

4 Ways to Use your Juice Bar Financing

1. Open a new location or expand an existing locations

Opening a second location, or expanding your existing one, is an exciting and capital-intensive undertaking. Of course, growing your business can also be a particularly stressful time. That’s why many entrepreneurs turn to juice bar loans when they’re expanding. The extra funds can be used for the many significant expenses that come with opening new business locations.

2. Paying for marketing and advertising costs

It’s easy to neglect your marketing efforts if business is going well. The trouble is, lack of marketing and advertising can hurt you in the future when things slow down. To make sure you’re busy with customers year-round, you can use juice bar financing to invest in marketing campaigns. Depending on your market, invest in marketing initiatives such as:
  • Direct mail
  • Sponsored social media posts
  • Online ads
  • can help you keep foot traffic high.

3. Hiring new employees and retaining existing ones

In 2019, the average per-employee cost for hiring a new employee was almost $4000. With the effects of inflation and a shortage of labor over the past two years, that cost has certainly gone up. Since finding and onboarding employees is often costly, it can be a good idea to use your loan to cover these expenses. At the same time, you can also use your business loan to fund new perks aimed at retaining your best employees.

4. Purchasing inventory

As a juice bar owner, procuring high-quality inventory at a good price is a requirement for success. Unfortunately, seasonal businesses like juice bars often face significant cash flow fluctuations. When cash flow is tight, it can be difficult to gather enough funds to purchase and manage inventory. Using a juice bar loan, you can eliminate or mitigate cash flow issues that prevent your inventory procurement from being as cost-efficient as possible.

Conclusion: Maximize Your Juice Bar Financing

To maximize your juice bar financing, you need to spend your funds on the projects that return the highest value for your business. Therefore, the highest value project for your business depends on many business and industry-specific variables. So only someone intimately familiar with your business and industry can tell you the best use of your money. The ideas featured in this blog post are a starting point. Ultimately, as the owner or manager, you must decide what the best use of your loan funds is.