Applying for a bank loan for your fledgling antiques business is a quick and easy process: you fill out the loan application, and the bank says “No!” It’s sad but it’s true. Bankers just don’t understand the antiques trade. Unlike most bankable retail businesses, the antiques trade has no published operating benchmarks, too many variables in valuing inventory and is overwhelmingly undercapitalized.
These days, even well-established antiques retailers and auction houses can be turned down for a loan. Since the banking crisis of 2008, the standards for small business loans have become so stringent that 70 percent of all small business loans are turned down. It’s no longer enough to have good credit and cash flow. In most cases, loan applicants must also have adequate collateral and show strong revenue growth and profitability for the past three years. How many antiques businesses do you know that have had strong revenue and profit growth in the past three years? Read More
Originally posted 2013-12-07 11:55:00.