Types of Business Loans in Richmond, KY: Fixed Installments, Revolving Draws and a Card-Sales Share

Inventory financing pays for goods a business will sell, and the balance comes down as those goods leave the shelf. Retail is the second-largest employer group in the county: County Business Patterns counted 294 retail trade establishments in Madison County, KY in 2023.

Illustration only, invented figures: a Richmond, KY hardware store places a $14,200 bulk order of paint, fasteners and caulk to get a volume price. In this invented example the financing carries a 12.4% annual rate, charged daily on what is still owed, and the store pays it down each month as the goods sell.

In the invented example the four months of interest come to $345.64, and the store owes nothing once the last $2,900 is paid. A partner may set a different paydown pattern or tie the balance to a stock count. The inventory financing page works through frame, packaging, nursery and floor-model orders.

A business loan is money a lender pays to a business for a business purpose, paid back with interest over a set schedule or, in the case of a credit line, as draws are repaid. The business, not the owner's household, uses the money, and the lender sets the rate, term and any collateral in its offer. Here, a call or the request form sends the need on to funding partners, and they make the call.

Residential building construction counted 44 employer establishments in Madison County, KY in 2023, with 198 paid employees (County Business Patterns, NAICS 2361). A home builder can request funding for crew payroll, tools or a material trailer; loans that pay for building the houses themselves are construction lending, which this site does not arrange.

So for a builder, the business loan question is narrower than it first sounds: wages due on Friday, a supplier account, or a piece of equipment, each with its own product further down this page.

Commercial loans can be sorted by the shape of their repayment rather than by name. A garment conveyor and ticketing system at a Richmond, KY dry cleaner shows the idea, since the same cost could be repaid in three ways.

Illustration only, invented figures: the conveyor, ticket printer and setup cost $9,850. In this invented example a term loan at an 11.95% annual rate over 24 months runs $463.44 a month; the 24 payments total $11,122.56, of which $1,272.56 is interest. Anchoring the conveyor to the floor or ceiling is property work outside this site.

A business term loan pays out one amount at the start and is paid back in installments over a set number of months. It suits a cost that has no resale value, such as moving a practice onto a new electronic health record system, where equipment financing has no machine to hold as security.

Offices of physicians in Madison County, KY carried a combined annual payroll of $59 million in 2023 across 56 employer establishments (County Business Patterns, NAICS 6211). A software conversion pulls staff time away from patients for weeks, so the cost lands on top of that payroll rather than replacing any of it.

Illustration only, invented figures: licenses, data migration and training come to $38,400. Spread over 48 months at a 10.65% annual rate in this invented example, the conversion costs $985.95 a month, or $47,325.60 across the schedule, with $8,925.60 going to interest.

Equipment financing is debt: either a loan or an equipment finance agreement, paid in installments, with the equipment as the security. Leasing works another way: the item stays the leasing company's property while the business pays for its use.

Offices of other health practitioners, the NAICS group that holds physical therapists and chiropractors, counted 61 employer establishments and 374 paid employees in Madison County, KY in 2023 (County Business Patterns, NAICS 6213).

Illustration only, invented figures: a therapy office finances two balance trainers costing $21,900 together. In this invented example an equipment finance agreement at an 11.15% annual rate over 36 months costs $718.53 a month, $25,867.08 over the 36 payments, and the trainers belong to the office at the end. Leases and loans on other items are worked through on the equipment financing page.

Unlike the five products above it, a merchant cash advance is not a loan at all: a provider pays a sum now and buys a share of the business's future card sales; the total to be collected is the advance times a factor, and the provider takes a set percentage, the holdback, from each day's card sales until that total is reached.

Illustration only, invented figures: a Richmond, KY florist accepts $12,000 against a 1.28 factor; the provider is owed $15,360 in all, which puts the price of the invented advance at $3,360. In this invented example the holdback is 12% and card sales average $1,450 a day, so about $174 goes to the provider each business day.

At that invented pace it takes about 89 business days to reach $15,360. Heavier sales days send more and lighter days send less, so the end date moves while the invented $15,360 total stays the same. The merchant cash advance page compares two holdback percentages and a fixed daily debit.

For a cost that sales cover within weeks, a line of credit is the other route; how one is requested, sized and drawn is worked through in a revolving line for shops and clinics.