How to Best Use Your Wholesale Business Loan
In this blog post, we’ll share a few ways that you can use your wholesale loan. Once you’ve considered all your options, be sure to take a step back to consider your business’s short term and long-term goals. What works for one wholesale and distribution company might not be the best plan for your business. Due to this, you should examine your own business model and decide what will generate the best results!
5 Ways to Spend Your Wholesale Business Loan
1. Purchase Inventory
Not only can you use your loan amount to keep inventory stocked, but you can also use these funds to invest in a more advanced tracking and managing system for your wholesale products.
Everyone involved in your business processes, from your vendors to your operations department, should be on the same page when it comes to your products. A wholesale business loan can save your team a lot of stress on an inventory-management level.
2. Hire More Employees
Are your employees feeling overworked, or are you struggling to keep up with growing demand? Running a wholesale business that’s understaffed can affect your overall productivity. Plus, overworked employees may pursue new opportunities if they’re feeling burnt out or unappreciated in the workplace.
It can be challenging to fill orders if you don’t have enough employees to do the work, so maintaining staffing levels is crucial. Once you receive a small business loan, you can expand your team, which will make it easier to meet your customers’ needs.
3. Invest in Marketing Projects
Maintaining a competitive edge is imperative as a business owner in the wholesale industry. If you don’t effectively market your small business, you could lose customers to your competitors.
Understandably, your retail customers are busy trying to run their own businesses, so capturing their attention can feel daunting. This is especially true if you don’t allot funds in your budget to marketing strategies.
Using your business loan, you can pay for marketing projects, such as:
- Turn your old marketing content into videos that you can share online
- Create physical items, like brochures and pamphlets
- If marketing is not your forte, hire a marketing master who can manage these tasks for you
- Invest in online advertisements, such as Facebook or LinkedIn ads
- Pay for advertising space in trade publications
- Pay for email marketing tools, so that you can market to your existing customer base
4. Upgrade Equipment
As you likely know, using outdated or broken equipment can risk your business’s productivity. Unfortunately, many wholesale business owners struggle to afford equipment due to how expensive it is. Luckily, you can use your small business loan to repair or replace equipment.
5. Use as Excess Cash Flow
Some business owners use their loan product to ensure they have enough working capital on-hand for whatever their expenses at the time might be. They like having the security of knowing they have access to additional cash flow, especially during slow seasons.
If you own a seasonal business or simply want to have access to extra cash flow, consider allotting your small business loan for this usage.
6. Pay for An Expansion Project
Is your business struggling to keep up with increased wholesale demands? If so, it might be time to expand your business operations.
Many business owners turn to wholesale lenders to finance their expansion projects. Once you weigh your financing options and receive a loan, you can start expanding your business. In some cases, that may mean moving to a larger production space or offering additional services. Regardless of how you plan to expand, having a business loan can help you responsibly grow your business.
Conclusion: Consider How to Best Use Your Wholesale Lending Product
Now that you have financing for your business, consider our wholesale business tips when deciding on how to use it! If you have additional funding needs or have yet to receive a business loan, be sure to contact the Fora Financial team to learn about our funding options.
Editor’s Note: This post was updated for accuracy and comprehensiveness in October 2021.
Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.