5 Ways To Raise Capital For Your Indie Retail Brand
One of the most vital things in running a successful business is raising capital. While it can take many forms, whether human, produced, natural, social, and financial resources, money is the first thing that comes to mind when talking about business financial capital.
Indeed, business financial capital refers to the money available to fund daily operations, purchase material assets and additional capital, and pay for the enterprise’s future growth expenses.
These days, however, money is harder to come by. Additionally, lending institutions and banks have imposed more stringent rules in approving applications and offer less affordable loan packages. This leaves fledgling business owners, especially those running independent retail brands, struggling for ways to raise much-needed capital.
By basic definition, an independent retail brand is responsible for the whole operations of its own business. This means that the brand is built from scratch, which entails raising all types of initial capital as well as all other business aspects such as advertising, marketing, sales, and so on.
If you fall under the said category, there’s no question that you need all the help you can get and make the most out of all the avenues available. Here are some tips to lighten your burden.
Maximize Existing Resources
If your startup business does not require too much capital, use your own money and a portion of your savings to kickstart your enterprise. When you’ve got enough faith in your product or service, you’ll feel secure enough to invest in your offering. However, remember that starting a business a bit like gambling; you either win or lose.
Being cautious is not a sin, especially now that the entire business sector is still recovering. In addition, the future of several business sectors, especially the retail industry, remains speculative.
So, if you don’t want to spend all your savings in a business endeavor, apply for a business credit card. Ideally, it should come from your own bank to make it easier and faster to acquire approval. Regardless of the source, opt for a business card from a bank that offers the best deal, such as those that offer the lowest interest and repayment rates.
Launch A Crowdfunding Campaign
Sometimes, it only takes a great product and an outstanding marketing pitch to get the support you need. This is the story of many startups who chose to engage in crowdfunding to raise additional capital. Click here for an interesting story on how donation platforms have helped ordinary people reach their dreams.
Crowdfunding gives you the opportunity to connect with like-minded individuals, sometimes big companies who have enough interest in what you have to offer. Having an excellent market pitch and telling a great story on how your business has evolved, as well as how it envisions itself, complemented by a good website and marketing pitch, are the elements of being noticed.
However, most investors willing to infuse fresh capital into your business will likely ask for some control of your venture, so choose wisely. If you want to remain an independent retail brand, you must be transparent about your values.
Strengthen Both Online and Offline Strategies
With the pandemic, almost all our activities have shifted to digital or online use, from learning and working to shopping and paying. Movement restrictions have further impacted those who operate physical stores, whether brick and mortar or giant supermarkets and malls.
Due to this shift in consumer preference and behavior, businesses are required to strengthen both their offline and online customer marketing strategies. There are things that work better together, and this includes digital and physical business operations.
Online shopping nightmares bug e-commerce shoppers on a daily basis, forcing some consumers to have a product look-see first before deciding to purchase in-store or online. Despite the pandemic, some people still choose to have personal interactions with products and store representatives more than anything else.
Secure A Loan
Despite these challenging times, getting a loan from either private or government-run lending institutions is still a viable option. If you know how and where to look, you may get the best deal that’s not too heavy on your business pocket. Your first task should be doing your homework by conducting research and comparing deals, looking at the fine print.
Private Lending Institutions
Most people go to banks for business lending. While there are many loan products being offered by these financial institutions, they typically provide two types of financing methods for enterprises: a working capital loan and a funding loan. Businesses need a working capital loan to complete a revenue-generating business process, while a funding loan is required to start a business. As mentioned earlier, most banks these days have imposed stricter rules, and borrowers are expected to jump through more hoops to have access to more funds.
Compared to private lending institutions, state-run personal and business loan programs impose lower interest rates, but the requirements may be more stringent. Government-run loan programs, for instance, require that the borrower have a good credit score, so if you don’t have one, don’t expect to get approved. In addition, business loan applicants also need to have been existing for at least one year and show financial records to indicate good financial standing.
Ask Neighbors, Friends, and Relatives for Additional Support
When things get terrible and challenging, who else do you expect to help you out but your family and friends?
A 2010 survey conducted by the research consortium Global Entrepreneurship Monitor has indicated that about 5% of adults have contributed to the additional business funding for someone they know. Surprisingly, apart from family members, your neighbors may be a good source of additional financing, as well. The research respondents said 32% of the funding contributions were for a neighbor or a friend, 26% to a family member, 11% to a relative, and 8% to an officemate.
Choose a family, friend, or neighbor who has business interests or skills. Opt for persons with whom you have close relations and those you know believe in your capabilities as an entrepreneur.
Getting the additional capital, you need for your business to scale is not accessible. However, there are plenty of options available, and it’s up to you to consider which type best suits your goals. Just don’t expect to have everything you need in a short time, as getting additional funds in these challenging times requires persistence and creative thinking.