Every business has a financial goal, but reaching this goal requires the injection of more money to increase the strength of various functions such as operations, marketing, or increasing outlets. But businesses often do not have the money to undertake these expansion projects. So do they just pass up on opportunities for promising ventures due to lack of finance? No! They take loans to get access to capital for financing their profitable business projects.
If you’re a cannabis business owner planning to grow or improve your business, here are a few ways a cannabis real estate loan can help you out.
Launch Your Business
If you have a brilliant idea for a cannabis business but not the capital to get started, You can apply for a cannabis real estate loan and get the capital to finance your business. Keep in mind that lenders and banks are businesses too, and they make profit from clients who pay back their loan amount with interest. So if you can give a convincing explanation of your cannabis business idea to a lender, they’ll be up to lend you money to launch your business.
Expand Your Business Operations
Once your business is up and running, you should know whether the number of demands for your product or service is more than the amount you’re capable of producing. If your production rate fails to meet the demands of your customers, you need to expand your business operations. You can use cannabis real estate financing to fund your expansion, whether that implies opening more locations or increasing the strength of your team.
For most cannabis businesses, equipment is the largest expense followed by rent/note payments. Cannabis equipment can be very expensive, with new-and-improved models coming out every year, but as retail prices continue to drop many operators are working under the assumption that the operations that survive will be the ones who can produce at the lowest cost per pound, and the performance of their equipment is a key factor in getting that cost down. Equipment loans are some of the most costly in the cannabis space, and borrowers don’t get any benefits from depreciation.
Build Your Business Credit
If your business is thriving, you can bet that your first loan surely will not be your last loan. Your business credit goes a long way in convincing lenders that you are good at what you do and that you are not a high-risk borrower. Maintaining a positive track record at even a small scale can be a huge benefit when applying for a loan.
If your plans of starting or growing your cannabis business are hindered by limited access to capital, always remember that you can use a loan to finance your business project. Many people are deterred from taking out a loan because they don’t want to be burdened by debt. But as long as you make good use of the loan proceeds, and use it for cost cutting or expansion purposes, you will not have any problem paying off the amount.
If you’re looking for cannabis real estate loans for financing your cannabis business projects, Rainbow Realty Group can provide you the financial support you need. Call us today and speak to our team to discuss your needs and solutions.