Whether you are running a small landscaping business or expanding to a full-service firm, the capital you need to meet day-to-day expenses and capitalize on new opportunities is essential. The type of loan you need will depend on your goals, company health, cash flow, and more. Fortunately, there are many financing options for landscaping contractors, from traditional bank loans to alternative lenders. Choosing the best one for your needs requires answering three essential questions:

How Do You Plan To Use The Loan?

Day-to-day expenses are high for landscaping companies. They may have inventory, payroll, employee training costs, equipment maintenance, marketing expenses, and other regular expenses. Many also have cyclical revenue patterns that can strain cash flow, especially during slow seasons. A small business loan for landscaping can help cover these expenses and free up funds for new projects or expansions.

Invoice Financing

The financing method that works best for seasonal businesses is invoice financing. With this option, you receive a lump sum of cash upfront, and as your invoices are paid, a percentage of each payment goes to pay back the loan. In this way, you can access the funds you need without having to put up any collateral or meet stringent credit requirements.

Working Capital Loan

A working capital loan can be a good fit for a landscaping business that is growing, or experiencing an unusually busy season that has stretched their cash reserves. With a quick application process, this type of loan can provide the funding you need to bridge a temporary cash shortfall, purchase new equipment, or take advantage of an opportunity.

Landscaping business loans are also a great choice for new or established businesses that don’t have the time or credit to wait for traditional financing methods like bank loans. Depending on the lender, you can typically get an answer within one business day, and loan terms are often much shorter than with bank or SBA loans.

If you are looking for a more long-term financing solution, consider a Small Business Administration (SBA) 7(a) business loan guarantee program. This program is available through a network of banks and credit unions that have been certified by the SBA to offer the program. It is a great option for landscapers because it allows the SBA to look at your business as a whole, with a less rigid focus on your financial history and credit score. If you don’t qualify for the SBA’s guaranteed loan program, a private business loan is another excellent choice. Depending on the lender, you may be able to obtain a small business loan for landscaping with a credit score of around 680 or higher. These loans come with competitive rates, longer term options, and lower minimum loan amounts than conventional banks. In addition, the interest rate is tax deductible. There are also private lenders that specialize in providing loans to small businesses, and they can often offer lower rates and a quicker approval process than a bank or SBA.