Merchant Cash Advances » Salon Business Advance

Salon Business Funding

Salon business owner sits in barber chair, holding pair of scissors, ready to provide professional hair services.

By Richard Wilson

Last Updated on

Estimated read time: 7 minutes

Need capital to make your salon better or keep it afloat? MCashAdvance is here to help. Whether you own a hair salon, nail salon, spa, or barbershop, we offer quick financial support. Our salon business advances range from $5,000 to $900,000, covering all types of salon businesses.

Getting a loan from a bank can be tough and takes a long time. It often involves a lot of paperwork, a good credit score, and can take weeks or even months.

MCashAdvance makes it easy to get access to the capital you need. We don’t need lots of paperwork or any collateral. You can get the capital fast, sometimes within 24 hours or up to 3 days. We also accept lower credit scores and don’t do a hard credit check that might affect your credit score when you apply.

Get a Salon Loan Alternative Now

MCA Feature Offer Details
MCA Amounts: $5,000 – $900,000
Factor Rate: 1.1 – 1.5
Holdback 10 – 25%
Repay In: 3 – 18 months
Funding Time: 1 – 3 days

Applying is easy, free, and won’t impact your credit score.

Get the salon financing you need today.

What is a Salon Business Advance?

A salon business advance is a type of merchant cash advance (MCA) created for salon businesses, including hair salons, nail salons, spas, and barbershops.

Your salon business sells a portion of its future credit card sales to MCashAdvance in exchange for an upfront lump sum of funds called a cash advance.

In exchange, we will deduct a small percentage of your daily credit card sales revenue until the advance is fully repaid.

Emergency Funding for Salons

In the beauty and salon industry, you might face sudden financial needs, like covering daily costs or unexpected expenses. MCashAdvance salon advances offer a quick solution for these emergencies. Whether it’s for day-to-day operations or unforeseen costs, our advances provide the fast funding your salon requires. You can use this advance for any emergency your salon faces, ensuring you have the financial support when you need it most.

Salon Financing for Any Purpose

Here are 9 common ways a cash advance can be utilized in your Salon:

  1. Upgrade Salon Equipment: Invest in the latest hair styling tools, spa equipment, or beauty technology to offer advanced services.
  2. Renovate Your Salon Space: Use the funds to refresh your salon’s interior design, creating a more luxurious and inviting atmosphere for clients.
  3. Expand Beauty Product Lines: Stock up on high-end or organic beauty products, expanding your retail offerings and potentially increasing sales.
  4. Enhance Salon Marketing Efforts: Allocate funds to marketing campaigns, social media advertising, or creating a more robust online presence to attract new clients.
  5. Implement Advanced Booking Software: Invest in a state-of-the-art appointment booking system to streamline scheduling and improve customer experience.
  6. Host Beauty Workshops or Events: Use the advance to organize workshops, beauty classes, or special events that can attract new customers and engage regulars.
  7. Train and Certify Staff: Provide your team with advanced training in the latest beauty techniques or fund their certification in specialized services.
  8. Improve Salon Ambience: Enhance your salon’s atmosphere with better lighting, comfortable seating, or ambient music systems to enrich the client experience.
  9. Expand Services: Use the funds to add new services like nail art, therapeutic massages, or specialized hair treatments, broadening your salon’s appeal.

Salon Advance Example

Let’s say you need a $7,700 salon merchant cash advance to purchase 3 new backwash systems for your salon. If you are approved for $7,700 and receive a funding offer with a factor rate of 1.15 and a daily credit card holdback percentage of 12%, your total repayment amount will be $8,855, which means you’ll be paying $1,155 in fees.

Advance Amount$7,700
Factor Rate1.15
Avg Monthly Credit Card Sales$14,000
Holdback Percentage12% of Daily Credit Card Sales
Daily Credit Card Sales$466.67 per day (approx.)
Daily Payment Amount$56.00 per day (approx.)
Repayment Term (in days)Approximately 137.5 days
Repayment Term (in months)Approximately 4.58 months
Total Repaid$7,700 (Advance Amount) + $1,155 (Fees) = $8,855

Salon Business Funding Eligibility

To be eligible for funding from MCashAdvance you must meet these 5 criteria:

  1. Your salon must have been operational for at least 6 months.
  2. Your beauty or hair salon should be generating a minimum of $100,000 per year in revenue.
  3. As the salon owner, your personal FICO score needs to be 550 or higher.
  4. Your salon business must utilize a business checking account.
  5. You, as the salon proprietor, must be over 18 years of age and a U.S. citizen.

How to Get a Salon Advance from MCashAdvance

To get an advance for your salon business from MCashAdvance, follow these 5 steps:

Step 1: Begin Online Application: Click Apply for an MCA to begin.

Step 2: Fill in Your Details: Provide information about your salon and some personal details as the owner of the salon.

Step 3: Submit Bank Statements: Upload the last three months’ bank statements of your salon.

Step 4: Await Review Process: One of our underwriters will review your cash advance application to decide on funding.

Step 5: Receive Offer and Funding: Once you get a funding offer, review it. If it suits your business needs, accept it, sign the MCA agreement and the funds will be deposited into your business account

Get a Salon Business Advance Now

or learn more about business cash advance loans

Salon Funding FAQs

Can salons get an SBA loan?

Yes, salons can potentially qualify for SBA loans such as the SBA 7(a) Loan, SBA Microloan, SBA Express Loan, and SBA Community Advantage Loan, which offer financing options to support their business needs.

Can salons get invoice financing loans?

As mentioned previously, salons may not typically qualify for invoice financing due to their limited invoice volume, unless they also operate in the retail sector with B2B transactions involving product sales.

Can banks provide loans to salons?

Banks generally require salons to have a minimum of two years in operation, a FICO credit score of 680 or higher, three years of cash flow records, and a clear business plan detailing fund usage. Meeting these criteria increases the likelihood of bank approval. If you can’t meet these requirements, consider applying for an advance from MCashAdvance, which offers more favorable eligibility criteria for salon owners seeking financial support to grow their business.

How does salon equipment financing work?

Salons can buy equipment like salon chairs and use the salon chairs as collateral to secure financing. At MCashAdvance, you can purchase salon chairs using our advances without having to use the equipment as collateral.

Can salons get business lines of credit?

Absolutely, salons can secure a business line of credit when they meet specific criteria tailored to the salon industry. Qualifications often encompass having a FICO credit score of 660 or higher, a minimum of one year in the salon business, and maintaining monthly salon revenue exceeding $5,000.

Why are lenders and credit unions often reluctant to finance beauty salons?

Lenders and credit unions often hesitate to finance beauty salons. This is because these businesses are seen as high-risk. The beauty salon industry is very competitive, and earnings can be unpredictable. Also, the success of a salon largely depends on its location, management, and staff skills, which are difficult for lenders to evaluate. This makes them cautious about giving loans to beauty salons.

How long does it take to pay off a salon advance?

Paying off a salon advance depends on daily credit card sales in your salon. Most advances take three to 18 months to repay. The more credit card sales your salon processes, the faster the repayment. Unlike loans, there’s no fixed period for repayment.

Why is an MCA a great alternative for beauty salons needing working capital?

An MCA is a suitable alternative for beauty salons needing working capital due to its flexible repayment structure and quick access to funds. MCAs provide upfront cash based on future credit card sales, making them ideal for salons with strong card-based transactions. The repayment adjusts with the salon’s sales volume, offering financial ease during slower business periods.

What are the ongoing expenses in a salon business that create the need for financing?

Ongoing expenses in a salon business include rent or mortgage payments, utility bills, payroll for staff, costs for salon supplies like hair products and equipment, marketing and advertising expenses, insurance, and maintenance costs. These regular expenses require a steady cash flow, and financing can help cover these costs, especially during initial growth phases or slower business periods and are the main reasons that create the need for financing.

What are the different types of loans available for beauty salons?

Beauty salons have several loan options: traditional bank loans, SBA loans, lines of credit, equipment financing, merchant cash advances, and business credit cards. However, not all options may be available if the salon lacks collateral, strong sales, or has bad credit. Each loan type has different requirements

How are MCAs repaid by beauty salons?

Beauty salons repay advances by giving a part of their daily card sales to the lender. This goes on until the advance is fully paid. Other methods include sales money going into a controlled account and automatic bank withdrawals. The repayment amount varies with the salon’s sales, offering flexibility. The process continues until the agreed total is reached. For more information, you can read How to repay an MCA.

About the Author: