Electronics Store Loans
It’s been a rough few years for the consumer electronic retail industry. Put simply, it is incredibly difficult to compete against discounted mega store electronic retailers like Walmart and Amazon, but that does not mean there isn’t hope for the consumer electronic retail store industry! Major electronic store giants like Amazon have completely shifted the playing field, leaving many consumer electronic stores at a loss for what to do and how to compete, but the best advice for any retail environment today is to take a lesson from what incumbents like Amazon did. They took advantage of the technological revolution sweeping across the world today.
Studies have shown that growth has been somewhat stagnant for most of the consumer electronic retail industry, and it is expected to see sluggish growth in the next few years. Luckily, there has still been decent employment rates and profits for the electronic stores that are transitioning their businesses into the new, technologically savvy business models. These upcoming years will really make or break a lot of electronic stores, but the key is staying on top of the technological and consumer trends that are shifting the way retail business is done. The list is endless for technological advancements that are benefiting many different retail stores across all industries, and being willing to take the next step and implement these useful tools into the business model is essential to surviving in this competitive industry.
Consumer Electronic Retail Industry Trends:
- Technology: Technology for any retail business should be at the forefront of every business owner’s mind. The rapidly evolving technological advancements greatly affect the consumer electronic retail industry in two major ways: offering the best, top of the line technological products, but by also having the top retail technological advancements to successfully cater to consumers by effectively running a business.
- Omnichannels and Social Media: Omnichannels have been dominating every industry in the past few years, but with a growing consumer base that is tethered to their smart phones, computers, and tablets, having a successful and strong omnichannel presence is simply unavoidable today. Creating a strong mobile presence, social media presence, and overall online presence is the biggest step that all consumer electronic stores need to be taking. Without a strong omnichannel presence, many consumer electronic retail stores will not be able to compete with other top online electronic retail providers, such as Amazon. Social media is a newer omnichannel component that many clothing retail stores have started to utilize successfully. For consumer electronic stores, the more successful online strategies implemented to reach younger generations, the easier it will be to compete with large, online discount electronic stores.
- Payment Options: While focusing on a strong online presence is vital for consumer electronic retail stores today, brick and mortar stores are still a necessary component to the business model. However, many consumers today are demanding faster checkout times, more personalized customer service experiences, and an overall great shopping experience. One of the top ways electronic retail stores are doing this is through the use of multiple Point of Sale and payment option systems. Most consumers want more security when purchasing items, and by upgrading payment operating systems, consumer electronic companies can reassure customers that their information is safe; in addition to security, updating point of sale systems allows more flexibility, ease, and quickness when ringing up customers, thus enhancing the consumer experience.
- Click and Collect Services: Many big consumer electronic retailers are taking advantage of omnichannels already, but by offering consumers the ability to quickly “click and collect” the product they want, they are able to cater more efficiently to the needs of the customer. Today, people want things immediately. Many large electronic stores are implementing successful click and collect services, either by allowing consumers to pick up the item in store, or better yet – have it delivered quickly to their doorstep.
- Cloud Based Systems: Cloud based systems are revolutionizing the entire retail shopping environment, as well as the effectiveness of doing business. By having access to single view systems that allow consumer electronic store business owners to view a variety of retail management information across all channels, the modern retail strategy is evolving. Through the use of single view and cloud based systems, many business owners are seeing increased sales, better inventory management, strong customer visibility across multiple channels, better data analytics, and a more effective omnichannel strategy. The cloud is unavoidable today, and by implementing these systems early on, many consumer electronic retailers will reap the rewards.
- Internet of Things: Similar to the cloud and onmnichannels, the Internet of Things is starting to dominate the retail world. Adding more smart devices into the retail environment will lead to a better customer shopping experience and stronger business models. A study by McKinsey showed that the Internet of Things could potentially have an economic impact of $410 billion to $1.2 trillion by 2025; this only reinforces the strong force the Internet of Things will have on business models across all industries.
- Innovative Products: One of the biggest issues being faced by consumer electronic retail businesses today is the constantly growing market for innovative technological products. Many electronic retail stores are struggling with too many options to display, but also having too much inventory of old products that are not selling well. Constantly staying on top of the latest innovative products that consumers are interested in is key, as well as making sure to limit the amount of products available in stores. Millennials are a difficult generation of consumers to please – they do not want to be overwhelmed by the amount of choices they have, but they want the best products. Catering to this demographic is key in staying ahead of major competitors.
- Customer Service: For any retail industry that has a brick and mortar storefront, customer service is key. Most consumer electronic retail stores struggle with finding employees that are knowledgeable and excited about the tech world, but can also engage and actively upsell customers. Making sure that the hiring process, as well as continued training, is smooth, effective, and successful is vital. Younger generations today rely heavily on third party resources and reviews – and you definitely do not want your store having tons of negative reviews due to customer service issues. This should be a top priority for every consumer electronic retail business owner.
Types of Retail Electronic Store Loans
|Bank||6-10%||3-7 years||14-30 days|
|SBA||6-10%||3-7 years||10-30 days|
|Line of Credit||5-15%||1 – 3 years||7-30 days|
|Alternative||6-25%||1-5 years||5-7 days|
|Cash Advance||1.16-1.55||3-24 months||1-3 days|
Electronic Store Bank Loans
Bank retail electronic loans provide small business owners with affordable financing along with terms that allow the company to comfortably service their debt. Conventional lenders offer a number of loan products, with the major types being term loans and lines of credit.
- Rates: 5-10%
- Terms: 1-25 years
Electronic Store SBA Loans
Pretty similar to traditional financing, SBA loans are financing products provided by conventional lenders. The major difference between conventional and SBA financing is the fact that the Small Business Administration agrees to cover a large percentage of the SBA lender’s losses should the electronics store default.
- Rates: 6-8%
- Terms: 7-25 years
Alternative Electronic Store Financing
Alternative business financing is much different than traditional financing in just about every way. While alternative loans have higher rates than bank loans, the process of applying and getting approved is much easier due to use of fintech technology and because of lower credit requirements.
- Rates: 9-25%
- Terms: 1-5 years
Electronic Store Business Cash Advance
An electronics store business cash advance is the sale of future electronic store revenues that will be deposited into the company bank account. The funder will purchase future receivables at a discount and provide financing almost immediately and collect repayment by taking a set amount from the bank account each day via ACH.
- Factor Rates: 1.16-1.50%
- Terms: 4 months – 2 years
Electronic Store MCA Advance
A merchant cash advance (MCA) is similar to a business cash advance, with the only difference is in the way the lender collects repayment. Merchant advances are repaid daily by taking a percentage of all revenue collect through credit card sales.
- Factor Rates: 1.16-1.35%
- Terms: 4-21 months