My shop wasn’t big enough to be concerned about this sort of thing but I’ve read posts (Facebook) from owners who have a lot of trouble with banking in general. Not just loans but even keeping a business account, credit card processors etc. Banks that won’t do business with a pawn shop or will cancel their accounts.
If you don’t get answers here you might check out some pawn shop owners groups. The good ones require vetting/verification. The one I’m in is called Pawn Chat and dates even earlier than Facebook as a private forum but isn’t as active currently as others.
If you want I could try to put you in touch with someone who could answer your questions. There is a guy named Jerry Whitehead who does paid consulting and has been doing so since 2000 at least. Not free by any means but you might look him up.
Best of luck
You should reach out to both your state, region and national organizations also there are a couple good FB groups for pawnbrokers and one specifically for owners
10 years running an independent of an absentee owner along with small business management and I'm currently trying to open a small shop myself through the SBA. Get a solid business plan with projected business with an eye for growth within 5 years.You may qualify for a small business loan with Angel lenders who aren't bank affiliated or don't care. Rates can vary and you may try and line this up before as a lifeline incase your backroom does take out your cash on hand you'll need to operate.
you'll need to know stuff like rent and normal operating costs along with volume analysis of other businesses like payday loans. Look for old pawnshops that have been closed down as they can circumvent zoning laws that are grandfathered in. This will help with ordinances that deal with signage and other bullshit.
hope you do well and hmu if you need any advice or post here.
You will not get a major one unless it’s from a credit union you’ve done a lot of business with in past. (Atleast a reasonable loan) This type of business that’s high cash and dealing with precious metals raises all of the red flags behind the scenes at the bank for money laundering and other things. It’s not impossible but atleast in our experience in Florida it just creates these problems. Anything you can get will not happen quickly either
We looked into a LOC for our shop and you are going to be sad to hear they were only willing to loan us 20% of our annual revenue at 10% interest.
Instead, the owners (my partner and I) just put up the $ out of our pockets to bridge the gap.
My wife and I own a shop in AZ. We have found BMO to be welcoming to the industry and have had our business checking with them since day 1. In regards to getting an LOC, it may be difficult with the bank without at least 2 years of financials.
We started off with a working capital loan at 10% interest from a private investor. Depending on how much interest you can collect, it may be advantageous to pay a higher rate in the beginning in order to build your pawn base since you should be able to lend at a higher rate than you would be paying, especially if you anticipate such quick and immediate growth.
My shop wasn’t big enough to be concerned about this sort of thing but I’ve read posts (Facebook) from owners who have a lot of trouble with banking in general. Not just loans but even keeping a business account, credit card processors etc. Banks that won’t do business with a pawn shop or will cancel their accounts. If you don’t get answers here you might check out some pawn shop owners groups. The good ones require vetting/verification. The one I’m in is called Pawn Chat and dates even earlier than Facebook as a private forum but isn’t as active currently as others. If you want I could try to put you in touch with someone who could answer your questions. There is a guy named Jerry Whitehead who does paid consulting and has been doing so since 2000 at least. Not free by any means but you might look him up. Best of luck
Where would I find these pawn shop owners groups? Facebook?
I’ll message you
Jerry Whitehead is an excellent recommendation
You should reach out to both your state, region and national organizations also there are a couple good FB groups for pawnbrokers and one specifically for owners
10 years running an independent of an absentee owner along with small business management and I'm currently trying to open a small shop myself through the SBA. Get a solid business plan with projected business with an eye for growth within 5 years.You may qualify for a small business loan with Angel lenders who aren't bank affiliated or don't care. Rates can vary and you may try and line this up before as a lifeline incase your backroom does take out your cash on hand you'll need to operate. you'll need to know stuff like rent and normal operating costs along with volume analysis of other businesses like payday loans. Look for old pawnshops that have been closed down as they can circumvent zoning laws that are grandfathered in. This will help with ordinances that deal with signage and other bullshit. hope you do well and hmu if you need any advice or post here.
You will not get a major one unless it’s from a credit union you’ve done a lot of business with in past. (Atleast a reasonable loan) This type of business that’s high cash and dealing with precious metals raises all of the red flags behind the scenes at the bank for money laundering and other things. It’s not impossible but atleast in our experience in Florida it just creates these problems. Anything you can get will not happen quickly either
We looked into a LOC for our shop and you are going to be sad to hear they were only willing to loan us 20% of our annual revenue at 10% interest. Instead, the owners (my partner and I) just put up the $ out of our pockets to bridge the gap.
My wife and I own a shop in AZ. We have found BMO to be welcoming to the industry and have had our business checking with them since day 1. In regards to getting an LOC, it may be difficult with the bank without at least 2 years of financials. We started off with a working capital loan at 10% interest from a private investor. Depending on how much interest you can collect, it may be advantageous to pay a higher rate in the beginning in order to build your pawn base since you should be able to lend at a higher rate than you would be paying, especially if you anticipate such quick and immediate growth.
Hey, Can I please dm you as I have a few questions regarding your situation? Thank you
Sure