What is retail financing?
Retail financing entails sourcing additional capital such as commercial loans that are more suited for retail businesses. Retailers can be more susceptible to seasonal fluctuations and other external factors that influence demand, meaning they may need to look towards alternative financing options.
Depending on the product, retailers need to actively and effectively respond to the rise or fall of demand. Responding to an increase in the demand for a product often requires purchasing additional supplies, equipment or software. Seasonal demand can even require hiring additional staff and may require investing in supplementary retail finance.
Similarly, preparing for the low-season or a downward trend in the demand for the product requires different financial preparations. Retail financing can help with cash-flow maintenance and inject some extra working capital as a buffer between seasons.