Business Funding, Easy As 1, 2, 3.

See if you're eligible for a loan, it only takes 30 seconds...

Step 1

1. Your Business (10 seconds)

Step 2

2. Monthly Sales (10 seconds)

Step 3

3. About You (10 seconds)



Privacy Notice


Download our funding guide

Get tips and inspiration on how to grow your business...

GeneralManaging Money

The Boost Capital Ecommerce Loans Guide

By August 24, 2016 No Comments
The Boost Capital Ecommerce Loans Guide

If you do business online, then ecommerce funding may be the solution for your finance needs. Being in a rapidly evolving digital marketplace, your business needs to take advantage of new opportunities as soon as they emerge to give you a competitive advantage, and unlike other forms of business lending that can be rigid and time consuming, ecommerce funding with Boost Capital is quick and simple.

The Advantages Of Ecommerce Funding

Save Time
Time is valuable for businesses, especially online. You can avoid the time-consuming and complex task of dealing with banks and unnecessary administrative procedures by choosing to get a loan with Boost Capital. We will look at your credit score and trading history to give an instant decision. We can fund businesses two days after their initial application. Once you have been approved you can access the funds on the same day.

Get Approved
You don’t need a business plan, evidence of capital/collateral or even perfect credit in order to secure your ecommerce funding. We lend between £3,000 and £500,000 to businesses based primarily on recent trading history and the overall health of your business.

Simple Application Process
Applying for ecommerce funding couldn’t be simpler with Boost Capital. Apply online, or call and simply answer a few short questions regarding time in business, monthly gross sales and the type of business you own, and your application will be submitted for review. Having ecommerce data to hand can make the process even simpler.

Affordable Repayments
We offer you the power to grow your business with your ecommerce funding as well as work with you to ensure repayments are customised to be affordable and meet your business’s cash flow model.

Occasions When A Loan Helps Online Sellers

Whether you trade on eBay, Magento, Amazon or an equivalent service, Boost Capital can analyse your online accounts to determine trends and your affordability immediately. It’s never been easier to apply for funding because the information is so easily accessible to lenders and the advantages for online SMEs are so clear.

1. Increase Your Working Capital

As you increase your sales online, you need to finance more inventory. Even if you are a profitable online retailer with minimum overheads, you may need to secure additional funds to grow. This is a typical situation most business find themselves in where external financing can help.

When an ecommerce business is healthy and you want it to grow there are 3 aspects you need to consider:

  • Inventory: This covers all of the products and goods you keep in stock.
  • Receivables: These are completed, but yet to be paid sales.
  • Payables: This is the money you owe to suppliers or contractors.

When you sum up inventory and receivables and subtract payables you get the net working capital of your business.

As you continue to sell, the revenue grows, but so will the financing requirement, this will impact the working capital you need to operate and grow a successful business and where a loan tailored to your online business may be the best solution.

2. Managing Growth And Decline Fluctuations

Sales aren’t always predictable and can fluctuate depending on a number of external factors. Seasonality is often just the nature of the online retail business, with many online retailers relying solely on peak periods to drive their business forward.

Even during periods of decline you still have to generate capital in order to keep your business running smoothly. Whilst many businesses choose to run sales, ridding themselves of inventory to minimise the negative impact a decline might have, this may be the more expensive option in the long run. ‘Flash sales’ may also impact your reputation if you are trying to build a specific brand image online.

For most businesses that endure periods of fluctuation it’s worth considering financing liquidity gaps through a loan.

3. Take Advantage Of Business Opportunities And Large Orders

Sometimes business problems can come at you in unexpected and positive ways. When your business evolves rapidly you could find yourself in a position where an opportunity presents itself, a large international order comes in online that you weren’t expecting or even the opportunity to buy inventory at discounted prices.

Reacting quickly to the market and unexpected opportunities will give you the competitive edge online, and for this you’ll need financial flexibility. If you don’t have the funds to take advantage of an upcoming opportunity, analysing financing costs vs. potential profit may help you decide if an ecommerce loan is right for you.

Factors To Consider When Taking Out An Ecommerce Loan

Loan interest is not the only factor to consider when making a decision on taking out a loan for your business. At Boost Capital there are other key factors we believe businesses should consider when deciding to apply for an ecommerce loan.

Costs
The cost of business financing is normally measured by the interest rate per annum or APR. There may also various fees applicable depending on the type of loan you decide to take out. You should be aware of the total cost in monetary terms i.e. a currency such as GBP.

Different Repayment Types
Depending on the finance solution you take from Boost Capital, various repayment types are possible. This can be discussed when you speak with one of our funding advisors, however it’s worth getting to understand the following types of repayment:

Amortizing loans are repaid in equal instalments. Each instalment contains an interest portion and a repayment of principal. This may be the best option if you generate constant income through your online business. At Boost Capital a fixed repayment amount is determined based on your business’s unique cash flow model, ensuring that you keep enough in your account to maintain day-to-day operations.

Bullet loans are typically repaid at the loan’s maturity in one payment. Bullet loans should be contrasted with amortizing loans, where the amount of principal is paid down over the life of the loan. There is no requirement that a loan be a bullet loan or an amortizing loan; combinations of all sorts exist.

A credit line is a commitment by a lender to lend you money up to a certain pre-defined amount at the time when you demand it. You get access to cash at your convenience. The repayment of a credit line is often bound to a payment schedule similar to that of an amortizing loan.

Terms Of A Loan
The term of the loan influences the repayment. The longer the term, the more interest you pay. Interest rates also tend to increase with longer terms because a longer time period adds more uncertainty for the lender. A longer term reduces your monthly cash outflow as the monthly repayment amount is smaller when the repayment of a loan is stretched out over a longer period of time.

It is also worth checking if and how you can repay a loan early. Depending on the finance solution you take from Boost Capital, there are also no penalties applied for early payments made. This can be discussed when you speak with one of our funding advisors.

Speed Of Loan
Increasingly, businesses need easy and quick access to capital. At Boost Capital, we are able to provide small business owners to access working capital in as few as 2 days to meet short-term business needs, such as buying equipment or funding a refurbishment.

Credit Impact
Taking out a business loan can impact your credit rating. It’s worth understanding whether the enquiry process involves a “hard” credit inquiry and a credit score pull. A poor credit history severely limits your chances of securing a conventional bank business loan. Boost Capital offers small business loans that do not carry the burden of a perfect credit history requirement. Unlike some providers, we only ever do a soft credit search so it doesn’t leave a footprint on your credit report.

Loan Amount
The maximum amount you can borrow depends on two things: your credit quality and your income. The loan amount that you should take out depends on your needs. Taking out a larger amount than needed will only cost you extra in interest. At Boost Capital we offer flexible business loans from £3,000 up to £500,000.

Summary

When you apply for a bank loan to help your online business, banks will request large amounts of credit data, history and administrative information. However, it’s unlikely that they will have a look at your ecommerce platforms where you might be selling and since banks don’t do this, it unlikely they’ll fully understand your business resulting in longer approval times and higher rejection rates.

Boost Capital who specialise in alternative lending to SMEs and online retailers considers the particular needs of your business. With simple, and hassle free application process Boost Capital can help you secure loans efficiently, enabling to you to grow your business and take full advantage of the market.

Speak to a member of our business loans team on 0800 138 9080

More businesses than ever before are looking to Boost Capital for their business financing needs. To learn more about how our UK small business loans work or to explore the business financing options that are available to you, contact us today!
Apply Now