How Healthcare Equipment Suppliers Can Benefit from Financing
The healthcare equipment business is exceptionally profitable because it fills a need that will never cease to exist. Because of this, it is also highly competitive. It is also very costly for a small business owner to keep an inventory of expensive supplies on-hand, which can make it very difficult to stay ahead of the technological and regulatory curves of the industry, as well as your competition. Fortunately, a variety of financing options are available that can help you a great deal.
Traditional (Bank) Loans
Medical equipment suppliers can apply for a traditional loan from a bank or credit union in basically the same way an individual applies for a mortgage or automobile loan. It certainly helps to have detailed information about the cost/benefit ratio of the healthcare equipment you’re proposing to purchase, but one of the nice things about bank loans is that once you’re approved, the money is yours to use however you like if you make your payments. The rates are usually good, too. The biggest drawback is the amount of time the application and approval process often take.
The U.S. Government Small Business Administration (SBA) has several programs designed to help entrepreneurs secure funding after exhausting attempts at receiving loans. Essentially, the SBA will work with a traditional financial institution and guarantee a portion of the loan. Since the government is assuming some of the risk, the lending institution is much more likely to agree to extend funding. The terms of SBA loans tend to be on the shorter side.
A merchant cash advance company can pay advances on a healthcare supply business’ future receivables or credit card transactions. This can be set up as an automatic electronic fund transfer at the point of sale. An advantage of cash advances is that you have the money in hand quickly, and you often don’t even notice the amount that is going toward payment as it’s being handled automatically.
If these traditional sources don’t provide funding, there are many alternative lenders eager to extend financing to businesses, just with shorter terms and higher rates. A positive side to alternative lending, though, is that the cash comes through quickly. If you need a quick influx to buy equipment or inventory, this is a method worth considering.
Running a small healthcare business can be difficult and expensive, but hopefully, one of these lending sources can ease your financial burden and help your business succeed!