Many retail business loans are aimed at traditional brick and mortar stores. But as consumer habits and the nature of shopping changes, banks are adapting their finance offerings in line. Online retailers now have more options than ever when it comes to securing funding, but that’s increasingly overwhelming. With so much choice and so many different financial products, it can be tricky to navigate which is best for your needs. In this article, we explore the topic of retail business loans in detail so that you can decide if they are right for you.

What Is A Retail Loan?

Retail loans are a type of finance product aimed specifically at stores. They allow retail business owners to borrow a fixed amount of money and then repay it in monthly installments. This enables retailers to purchase stock, expand into new premises, invest in marketing campaigns, or any number of other business activities. Because these loans are aimed specifically at retail businesses, they are usually tailored to the bespoke needs of these types of companies.

Retail sales are influenced by a number of factors – consumer confidence, unemployment levels, and wages all play a huge role. They can also be hard to predict which makes it difficult for small business owners to plan for the long-term. Although US retail sales were expected to rise 3.8-4.4% this year, they’ve actually decreased unexpectedly by 0.2%. This demonstrates just how volatile the retail industry can be which makes it common for stores to seek out short-term financing solutions.

How They Can Be Used

Retail business loans can be used for a number of different purposes. Some store owners use them for additional cash flow whereas others get loans to fund expansion. They can be a useful tool for overcoming business challenges that are unique to the retail sector. Here is an overview of some of the most common issues that retail businesses experience:

  • Seasonality – the peaks and troughs of seasonal revenue can put a strain on cash flow.
  • Inventory – unpredictable sell-through rates can wipe out stock levels, reducing revenue potential and impacting customer satisfaction.
  • Competition – the retail sector is constantly evolving with never-ending pressure to attract more customers and keep existing ones loyal.
  • Staffing – seasonal demand also leads to flexible hiring requirements to increase and decrease with customer orders.

Let’s look at some of the ways that retail business loans can be used to overcome these challenges.


Many retail businesses have a seasonal aspect to their operations. It may be that the products they sell are in greater demand at certain times of the year. Or they experience a varied footfall depending on the season (especially true for stores in popular holiday spots). Seasonality is a normal part of the business cycle but it can cause problems if it’s unpredictable.

Having peaks and troughs in revenue can put a severe strain on cash flow. You may find that some months there just isn’t enough coming in to cover your costs. But other months you’ve more than enough to pay for everything several times over! Careful planning and budgeting can help you to weather these ups and downs so that your cash flow remains buoyant throughout the slow season. But if these dips are unpredictable, then no amount of planning will help you avoid them.

This is where retail business loans can help. They enable you to sure up your cash flow during the quiet periods, safe in the knowledge that you’ll make the money back during your busy season. They allow you to cover essential costs like renting business premises, hiring equipment, paying staff, and other overheads. This removes much of the stress for business owners and allows them to focus on running their store instead of worrying about finances.


Inventory management is essential to the success of any retailer. Whether you sell your products on Main Street, through Shopify, or via a network of third-party distributors, having enough stock is vital. If you don’t have enough inventory and you run out of things to sell, then you’ve severely limited your revenue potential. Problems like this can also disappoint customers and retail partners, sometimes damaging the relationship irreparably.

Retailers can use a business loan to purchase the amount of stock they need to satisfy demand and meet revenue targets. This type of financing provides the capital you need to pay suppliers and can even allow you to benefit from bulk order discounts. Having more cash enables you to place bigger orders and reduce the individual unit cost, which all contributes to a healthier profit margin.


Running a retail store can be a never-ending challenge. As soon as you think you’ve got things sussed, a competitor comes along to steal away all your customers. When others undercut your prices or offer a wider selection of products, it can be hard for even the most loyal clients to resist. It may feel like you’re fighting an uphill battle to stay afloat but there are ways to stay ahead.

Retail business loans can be used to invest in strategic marketing campaigns that position your store as different and better than competitors. Some businesses use them to upgrade internal software, improve their e-commerce offering, expand their logistical capabilities, or buy brand new POS. Investing in areas that will deliver an enhanced customer experience, whether that’s through in-store shopping or delivery of online orders, is a sure-fire way to stay ahead of the market.


Staffing is often a challenge for retail stores. For some, it’s related to the seasonal nature of their business. If you don’t know when it’ll be busy and when times will be quiet, it’s hard to predict how many employees you’ll need. For others, it’s the availability of staff that they find tough. In towns and cities with universities, students are often hired by retailers on a part-time basis. But once the summer comes, they all head back to their home towns, leaving many shops understaffed.

If you don’t have sufficient cash flow to hire more staff during busy periods, then you’re leaving money on the table. Retail revenue usually increases in line with the size of the product range and the number of customer-facing staff, so it pays to hire enough employees. This allows them to service more customers, avoids frustrating queues at the checkout, and keeps the store operating at full capacity. Business loans can be used to pay for additional staff as needed and allow you to achieve your revenue potential.

Types of Retail Loans

Retail business loans come in varying shapes and sizes. There are a number of different types available to companies and the individuals who run them. Most loans can be used for a wide variety of business purposes but may be structured differently. The most common types of retail store loans are:

  • Long-term – usually have a loan term of 2-5 years
  • Short-term – usually have a loan term of 2 years or less
  • Secured – require some kind of guarantee in the form of security or collateral
  • Unsecured – no security or collateral required

Commercial loans come with a variety of fees, repayment durations, interest rates, terms, and conditions. The type of loan you choose will have a big influence on these aspects. For example, long-term loans tend to have lower interest rates than a short-term one. Whereas unsecured retail business loans tend to have higher interest rates than secured ones. Your business requirements, capacity to repay, business credit history, and any number of other factors can also influence the types of loan that are available to you.

Factors To Consider

If you’re thinking about getting a loan, then there are several factors to consider. Most loans have a fixed term lasting several years so it’s not a commitment to be taken lightly. Once you’ve signed on the dotted line, you’ll be tied in until the amount is fully repaid. So, it’s vital to make an informed choice and partner with the best lender for your needs. But how do you know if your business is getting the best deal? Here are a few of the key factors to consider:

  • Does the loan provider understand the retail industry? Look for funding partners that have experience with the sector and understand the nuances of running a store.
  • Do they come highly recommended? Speak to other retailers and store owners to find out who they’ve worked with and what their experiences where like.
  • Will they tailor their offering? A one-size-fits-all approach rarely works in business so look for a lender who will customize their loan products to your specific business needs.
  • Can they provide the loan size you need? Some financial institutions have minimum and maximum loan sizes so it’s important to check if they’ll accommodate yours.
  • How complex is the application process? Some traditional lenders (like the SBA) have a long and complicated application form to complete, which then takes weeks or months to be reviewed. At Strategic Capital, we keep the process short and can usually give you a decision within 24 hours.

By considering all of these factors, you’ll give yourself the best chance of finding the right lender. Be sure to compare all the features before committing to a provider – a little extra research may uncover a better deal and save you precious money.

Why Choose Strategic Capital?

If you’re looking at different retail business loans, then here are a few reasons to choose us as your funding partner.

Fast Approvals

As an online lender, we utilize the latest digital processes to screen and process applications. This enables us to cut out many of the time-consuming and labor-intensive steps that traditional banks still follow. By leveraging the newest digital technologies, we can give you a decision quickly and then transfer the funds almost immediately. At Strategic Capital, we can often tell you whether you’ve been approved the same business day and give you quick access to funds in less than a week.

Simple to Apply For

Applying for retail business loans can be a daunting process. It has a reputation for long application forms and mountains of supporting paperwork. But in the modern era of online lenders, this is no longer the case. Our application forms are online and streamlined so that they are quicker and easier to complete. Lenders like us can now check much of your background info (like credit score and repayment history) online so there’s less supporting evidence needed.


The affordability of the funding is crucial to whether you’ll be able to pay it back easily or end up being charged with additional fees. We take an up-front approach to finance and will be open about all of the costs involved. Our interest rates on short term loans are some of the most competitive in the industry and start at 5.49%.

  • Min business loan amount – $20,000
  • Max business loan amount – $1 million
  • Min credit score required – 650
  • Min monthly revenue – $20,000
  • Min trading time – 2 years

More Than a Number

When financial institutions make decisions that are purely based on numbers, they fail to see the big picture. Looking at a retail business in these black and white terms doesn’t allow them to see beyond the paperwork. We prefer to consider each business on its individual merits as this helps us to see opportunities for growth and investment. By looking at each customer individually, we can also advise them on the best funding options for their situation.

Business Loans from Strategic Capital

Strategic Capital provides retail business loans to a wide range of companies across the USA. Whether it’s to pay for your everyday costs, emergency repairs to equipment, or investing in expansion, we offer small business finance solutions without the hassle of traditional banks. Best of all, you’ll benefit from competitive terms and a simple application process, so you’ll soon have more money to reinvest into your business.

Transparency, innovation, and expertise are the driving factors behind everything we do. With a talented team of advisors, a plethora of funding partners, and the best technology available – we go above and beyond to help our clients receive their capital rapidly with the industry’s most competitive repayment options and interest rates. We want to break speed records, not bank accounts. Upon submitting your application, it’s reviewed by a dedicated Capital Advisor. We generate the best rates and terms at lightning speed through our funding matrix and robust lender network. Yep… it’s that simple.

Learn more about our retail business loans, invoice financing, business lines of credit, and merchant cash advances here.

Checking for pre-approval will not affect your credit score.