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Thursday, 28th April 2022 | Small business financing Canada,Management

Business equipment financing: what it is and how to get it

Read our blog to get an understanding of business loans and how you can successfully apply for one to expand your locations, hire better staff and invest in better inventory.

What are business equipment loans?

Business equipment loans can come from various places, depending on your credit history and the type of equipment you're looking to buy. Among these sources are:

Banks
Credit unions
Online lenders
Financiers of equipment

Depending on the nature of the equipment, it may be possible to utilize the equipment as collateral for the loan. In addition, equipment loans can often be for lesser amounts than regular bank loans, depending on the type and cost of the acquired equipment; this might make traditional financing a possibility for qualifying small company borrowers.

Business equipment loans have different terms depending on the lender. Most commercial loans have maximum payback duration of seven years, with interest rates varying based on the lender, your credit history, and the amount borrowed.

To apply for business equipment loans at a credit union, you must first become a member.
Online lenders such as iCapital also provide equipment financing. Rates and periods vary based on the lender you pick, just as they do with traditional lenders. Although interest rates may be higher, online lenders are known for their quick replies, often responding within an hour and depositing funds into your business bank account within a day or two – and sometimes in as little as 24 hours.

While loan conditions vary depending on the lender, most traditional lenders will want a down payment, often about 20% of the loan amount. The interest on business equipment loans, like other loans, is tax-deductible.

Should you get a business loan for your equipment?

Regardless of the sort of business, you run, quality on-site equipment can be rather costly. For example, let's pretend you're setting up a restaurant, bar, or coffee shop. While you may be able to cover certain costs on your own, most industrial kitchen appliances (fridges, beverage dispensers, stoves, and so on) are expensive. Also, don't forget about the cost of production equipment. This is where a business loan can help you and your company open many doors. With a business loan, you'll be able to get the gear you need to increase your profit and sales.

Documents required for equipment business loan

Secured business loan list of items that a lender will ask you for when authorizing a loan.

Personal credit score and company credit score

Lenders will frequently evaluate your credit score and business credit to determine your creditworthiness and the duration for which you’ve run your business.

Business details

Your lender will ask for your business address, business name, business license number, and other information to identify your company.

Financial records

Before approving your firm for financing, a lender will assess your financial health by reviewing specific financial documents to see if you can repay the loan.

Tax Returns and Bank Statements: Your lender will use these papers to assess your monthly and annual earnings.
Revenue Statements: Your business's sales records and revenue statements will help your lender comprehend your cash flow, which is crucial in convincing them to lend to you.

Personal financial records

A lender may request your bank statements to evaluate your creditworthiness, especially if you offer a personal guarantee.

Pros and cons of equipment financing

There are several advantages to financing equipment. If the equipment acts as security, these loans may not require collateral. Qualifying for this form of finance may be easier than for other types of funding, especially if you have a newer firm or a less-than-perfect credit history.

However, one thing to think about is what this would entail for your interest rate. If your credit score is near the bottom of the range that the lender typically expects from its clients, you may pay a higher annual percentage rate for equipment financing. The greater the interest rate, the more you'll pay in interest throughout the life of the equipment loan.

How iCapital can help your business

While many types of equipment might deplete your company's budget, this won't be an issue if you pick iCapital to handle your finance needs. And suitable financing isn't the only advantage we have to offer. There are several more reasons to choose iCapital, including but not limited to:

5-minute application process
24-hour approval
Up to $250,000 in 48 hours

Remember that iCapital is here to assist you in finding the best financing option for your business equipment loans. All you have to do is contact us today at 1.877.251.7171!

5 Cost-Effective Strategies to Scale Your Canadian Small Business

Congratulations! You've built a thriving small business. But with success comes the exciting (and sometimes daunting) question: Is it time to grow? This guide explores the signs your business is ready for expansion and offers 5 cost-effective strategies to achieve it, all while keeping your finances in check.

Why Grow Your Business?

The definition of success varies greatly between businesses. Some prioritize revenue, while others focus on community impact. Regardless of your goals, a thriving small business is a strong indicator of potential for growth. Here are some key reasons to consider scaling your operations:

Demand: Are you struggling to meet increasing customer demand for your products or services? Expanding your capacity through additional staff or inventory can help.
Profit: Healthy profits allow you to reinvest in growth initiatives. Analyze your current profit margins to determine if expansion is financially viable.
Longevity: Many businesses strive for long-term success. Consider how growth will impact your business's sustainability and future potential.

Is Your Canadian Business Ready to Expand?

Here are some key factors to consider before taking the leap:

Growing Team: A growing team suggests your business is handling an increased workload. Hiring additional staff is a clear sign you're ready to handle more.
Unable to Meet Demand: Are you turning away customers due to limited capacity? If so, this indicates a need for expansion to capitalize on existing demand.
Abundant Cash and Financial Stability: While increased revenue is a positive sign, it's not the only factor. Analyze your overall financial health to ensure expansion won't strain your resources.
Meeting or Exceeding Business Goals: Surpassing your existing goals demonstrates a successful business model. Scaling your operations can help you achieve even greater success.
Too Much Space or Resources: Are you finding yourself with unused space or underutilized resources? This could be a sign you're ready to expand your product offerings or customer base.
Intuition: Sometimes, your gut feeling is the best indicator. Trust your instincts alongside the data if you feel strongly about scaling your business.

5 Cost-Effective Strategies to Grow Your Canadian Business

Growth doesn't have to break the bank. Here are 10 ways to achieve sustainable business expansion without overspending:

Start with a Growth Business Plan: Don't jump in blindly. Create a roadmap outlining your specific growth goals and strategies. Revisit your original business plan and adapt it to reflect your new ambitions.
Do Your Research: Educate yourself on Canadian industry trends and competitor strategies. Talk to other entrepreneurs who have successfully scaled their businesses. By gathering information, you can avoid costly mistakes and make informed decisions.
Nurture Your Existing Customers: Loyal customers are your most valuable asset. Prioritize excellent customer service and implement strategies to retain their business.
Leverage Social Media: Build a strong social media presence to connect with potential customers organically. Utilize free social media tools to create engaging content and interact with your audience.
Automate Tasks: Free up valuable time and resources by automating repetitive tasks. Explore cost-effective automation tools that streamline processes like scheduling, payroll, and data management.

Focus on What Matters Most: Growing Your Business

Running a Canadian small business requires dedication on many fronts. When it comes to growth, securing the right financing can be a major hurdle. At iCapital, we help you overcome this hurdle and free you to focus on what matters most: Growing your business.

iCapital: Fast Funding for Canadian Businesses

Get approved in 24 hours and fuel your growth with iCapital's streamlined financing solutions. Choose from flexible options like Term Loans, Recurring Term Loans, and Secured Business Loans – all with transparent fees. Apply online in minutes and get started today.

Small business financing Canada

iCapital Helping SMBs Weather Cash Flow Challenges

Unplugging for Success: How Small Business Owners Can Take a Well-Deserved Vacation

In the whirlwind of running a small business, taking a vacation might seem like a distant dream. However, it's precisely when you're in charge that you must prioritize your well-being and rejuvenate yourself. Planning a vacation isn't just about booking flights and accommodation; it's about ensuring your business can thrive in your absence and that you can return rejuvenated and ready to tackle new challenges. Let's delve into how small business owners can successfully unplug and enjoy a well-deserved break.

Planning for Success

Start by considering the best time of year for your getaway—ideally when projects are wrapping up, and sales are steady but not overwhelming. Tie up loose ends before you leave, pay bills in advance and update clients and suppliers about your absence. Provide them with contact information for someone who can assist them while you’re away.

Empowering Your Team

If you have a team, view your vacation as an opportunity for them to shine. Begin preparing them well in advance, gradually delegating more responsibilities as your departure date approaches. Offer detailed instructions for complex tasks and discuss potential scenarios they may encounter in your absence. This empowers your team and fosters a culture of trust and accountability within your business.

For entrepreneurs or sole proprietors without a team, automation can be a game-changer in maintaining business operations during your absence. Embrace the power of AI and automation tools to streamline processes and keep your business running smoothly. Consider utilizing answering services to handle customer inquiries and appointment bookings, allowing you to step away without compromising customer service. Automate bookkeeping and computer processes wherever possible, striking a balance between maintaining service levels and ensuring your business retains its personal touch.

Unplugging for True Relaxation

Strive to minimize contact with clients and staff while you’re away, allowing yourself a true break. Schedule occasional check-ins if necessary, but limit them to specific times and stick to the plan. Communicate with your staff about how they can reach you in case of emergencies, but otherwise, resist the urge to constantly check-in.

Returning Refreshed and Rejuvenated

Upon your return, keep your schedule clear for the first few days to catch up on missed tasks. Make a list of items requiring immediate attention to help you ease back into work seamlessly. Remember, taking a break allows your body to recharge, leading to increased productivity upon your return.

Embracing the Benefits of Vacation

If you’re still hesitant to take a vacation, consider the benefits it offers. Time away from work allows your mind and body to recharge, leading to increased productivity and creativity upon your return. Even short breaks can profoundly impact your overall well-being and business success.

Prioritizing self-care isn't just a luxury; it's a necessity for sustainable business growth. By planning strategically, empowering your team, and embracing the benefits of unplugging, you can enjoy a well-deserved vacation while ensuring your business continues to thrive in your absence. So book that trip and savour the opportunity to unwind and recharge. Your business—and your future self—will thank you for it.

Management

Springing Forward: Essential Marketing Tips for Small Businesses

As the world awakens from the slumber of winter, small businesses have an opportunity to tap into the vibrant energy of spring and breathe new life into their marketing strategies. Just as nature undergoes a transformation, so too can your marketing strategies. Spring presents a golden opportunity for you to refresh your approach and connect with your customers in meaningful ways. Here are six essential marketing tips tailored specifically for small businesses like yours as we transition into the season of growth:

Host Engaging Events:

Springtime calls for outdoor gatherings and community events that bring people together. From street fairs to garden parties, consider hosting events that showcase your brand and provide value to attendees. These events offer a unique opportunity for you to connect with your customers on a personal level, fostering relationships and building brand loyalty.

Refresh Your Branding:

Just as the world outside undergoes a transformation, consider giving your branding a fresh update. Infuse your website, social media profiles, and marketing materials with imagery and messaging that captures the spirit of the season. Whether it's incorporating vibrant colours or using nature-inspired themes, refreshing your branding can captivate your audience and make your brand stand out.

Offer Springtime Promotions:

Take advantage of the season to offer enticing promotions and discounts that resonate with your audience. Whether it's a spring sale, a limited-time offer, or a special promotion tied to seasonal activities, create a sense of urgency to encourage customers to take action. By aligning your promotions with the themes of spring, you can drive sales and attract new customers to your business.

Connect with Your Community:

Spring is a time for renewal and connection, making it the perfect opportunity for you to engage with your local community. Partner with other businesses or organizations to co-host events, sponsor local initiatives, or participate in community clean-up efforts. Demonstrating your commitment to your community can build goodwill and strengthen your brand's reputation.

Embrace Seasonal Content:

Spring offers a wealth of opportunities to create content that resonates with your audience. From tips for spring cleaning to ideas for outdoor activities, leverage the season to provide value to your customers through your blog, social media, and email newsletters. By sharing timely and relevant content, you can strengthen your relationship with your audience and position your brand as a trusted resource.

Track and Measure Results:

As you implement your spring marketing initiatives, be sure to track and measure their effectiveness. Use analytics tools to monitor key metrics such as website traffic, social media engagement, and sales performance. By analyzing the data, you can gain valuable insights into what's working and what's not, allowing you to refine your strategy and optimize your efforts for maximum impact.

Spring gives your small business an invaluable chance to revitalize your marketing endeavours and forge deeper connections with your customers. By integrating these essential marketing tips into your strategy, you can harness the vibrant energy of the season and position your business for growth and success in the months ahead. So let's seize the spirit of spring and spring forward together towards a bright and prosperous future for your business.

Marketing