Six funding types, each matched to a kind of cost: stock, long-lived purchases, repeat bills, timing gaps, equipment and card sales. Invented examples show how each one is priced. Funding partners set any terms.
What inventory financing is, shown with a Collierville, TN retail shop’s stock order
Inventory financing pays for goods a business will resell, and it is paid back as those goods sell. Retail is the sector with the most establishments in ZIP 38017: 202 retail trade establishments had a ZIP 38017 address in 2023 (ZBP).
Illustration only, invented figures: a Collierville, TN gift shop orders $24,800 of stock ahead of a large corporate order and finances it over 6 months at a 12.15% annual rate. The invented payment is $4,281.04, and the six invented payments total $25,686.24, so the stock costs $886.24 more than paying cash in this invented case.
Weeks, months or years: how long each of the six funding types runs for a Collierville, TN office
- Weeks: a merchant cash advance is collected from daily card sales until the agreed amount is remitted.
- Months: working capital loans and inventory financing match a gap that closes when fees or sales come in.
- Open-ended: a line of credit stays available, and each draw is repaid on its own schedule.
- Years: term loans and equipment financing spread a purchase over the years it will be used.
Lengths vary by partner and offer. The pattern above is a way to sort a cost, not a promise of any term.
Commercial loans a Collierville, TN accounting firm can request for a second office’s computers and software
When an existing accounting firm opens a second office, the costs split into pieces that fit different commercial loan types. Workstations, a document scanner and a network printer will be in use for years, so a term loan or equipment financing matches them. Tax and practice software licenses renew every year and can sit on a line of credit. The first payroll for added staff can come from working capital.
Walls, wiring and any change to the suite itself are property work and fall outside this site, and so is office furniture; the computers, scanner and software that go into the second office are not.
What is a business term loan? Adjustment tables at a Shelby County, TN chiropractic office, priced by the month
A business term loan is one amount paid back in equal monthly installments over a fixed number of months. Shelby County, TN counted 337 offices of other health practitioners, the group that includes chiropractors and physical therapists, in 2023 (CBP, NAICS 6213).
Illustration only, invented figures: a chiropractic office buys adjustment tables and treatment-room computers for $31,750 on a 48-month term loan at a 10.95% annual rate. The invented payment is $819.82, the invented total is $39,351.36, and the invented interest is $7,601.36.
An article on interest-only months shows how a short interest-only start changes a term loan’s payments and its total.
What is a business line of credit? Software renewals at a Shelby County, TN firm, drawn and paid back down
A business line of credit is a set limit the business draws from when a bill arrives and pays back as cash comes in. Interest runs on the drawn balance only, and a repaid amount can be drawn again.
Illustration only, invented figures: a Shelby County, TN firm draws $9,400 on a $30,000 line for annual software renewals and repays it 45 days later. At a 13.15% annual rate, the invented interest for those 45 days is $152.40, figured on the $9,400 drawn and not on the unused invented $20,600.
Equipment financing as a loan backed by the item itself: laptops for a Collierville, TN accounting firm
Equipment financing is a loan (or a lease) in which the equipment itself secures the payment. If the payments stop, the funding source can claim the item, which is why the item’s value matters to the offer.
Illustration only, invented figures: a Collierville, TN accounting firm replaces 14 laptops at $1,650 each, $23,100 in all, over 36 months at an 11.4% annual rate. That works out to an invented $760.65 each month and $27,383.40 across all 36 invented payments.
By Baydale Funding Group · Updated
