The Best Time to Get a Merchant Cash Advance for Spring Businesses

March 2020

Does your business bloom in the springtime? Or does it fade away? Either way, if you see a predictable change in your revenues at specific times each year, your business has a seasonal cycle. That’s different from business cycles that power national and global economies - which are predictable to some extent by analyzing data, but don’t occur seasonally.

Knowing what seasonal cycles affect your business, and watching how the global and domestic business cycle is moving, is critical to your success. It helps you plan ahead to leverage a strongly profitable seasonal cycle and enables you to manage your risk if your seasonal and/or the overall business cycle is impacted by issues such as weather, health crises, natural disasters and other issues.

Seasonal cycles impact on small businesses

Your business’ own seasonal cycle and the bigger business cycles do have one thing in common, they each have four stages: expansion, peak, contraction and trough. During the expansion period, your business is starting to pick up momentum until it hits its peak growth period – this is when you’re seeing the biggest revenues of the year. Sadly, this is followed by contraction; revenues start to slow until you hit the trough – the slowest part of your annual business cycle.

You may have more than one peak cycle too. Your business could peak for several months in Spring, and see a second, shorter seasonal uplift around the winter holidays.

The greater business cycle will almost certainly impact your seasonal cycle so its important to keep an eye on both. Even if, for example, spring is your busiest time of year, a slowdown in the overall business cycle can cause significant financial issues if it occurs during your seasonal peak. An obvious example is the current Corona virus business cycle slowdown, which is likely to deeply impact businesses that rely on spring break travel.

Not all business cycles are negative, of course. A peak business cycle that coincides with a peak seasonal cycle is exceptionally good for small business. A strong enough peak business cycle may even provide strong revenues during a typically slower point in your season.

Seasonal cycles and Merchant Cash Advances

First, let’s define Merchant Cash Advances (MCAs). They aren’t loans; they are an advance against a business’s expected future income. An MCA enables smaller businesses to get a lump sum of cash now and pay it back over a period of time by an automated withdrawal of a set percentage of your (usually daily, but terms can vary) business transactions. Typically, MCAs are a great option for businesses such as shops and restaurants that get most of their income from daily credit card and debit card transactions. But others small businesses can also qualify for a merchant cash advance.

A business owner doesn’t have to have a great credit history to be approved for an MCA, or collateral to secure the funding. This makes MCAs an especially attractive option for the average businessperson who has a solid income but doesn’t meet the strict requirements necessary get approved for a traditional bank loan.

Merchant Cash Advances have specific advantages for a seasonal business. The key is that the advance is paid back from a set percentage of the merchant’s actual revenues. For example, if the set percentage is 10%, and the day’s revenues total $3000, then the repayment amount for that day is $300. On another day, when revenues are $1,500, the repayment amount would be $150. Repayments are automatically withdrawn according to the terms of the MCA until the advance and any associated fees and interest are paid back.

So, when business is booming, paying back the advance reflects the increased revenues. And when the cycle slows – be it seasonal or due to a dip in the business cycle – the payback amount also drops. Much less stressful than having to come up with a set amount each month, like you typically would with a small business or personal loan, during good times and bad.

Advantages of Merchant Cash Advances

Additional advantages of Merchant Cash Advances for a small business include fast access to funds. So, let’s say your business typically sees an upswing during spring. You can still apply for a Merchant Cash Advance right now and receive access to funds during your peak season. MCA funds are typically deposited into the business owners account within 72 hours of you accepting an MCA offer. Compare that to money from a business bank loan, which you typically will not be able to access for a month or more (sometimes much longer, depending on your credit history and lender).

How do I get a Merchant Cash Advance?

One Park Financial works to help owners of small and mid-sized businesses access the funding options that meets their needs, including Merchant Cash Advances. Established in 2010 and founded by entrepreneurs, One Park Financial understands the challenges associated with small business loans and their need for working capital. Visit or call 855.218.8819 and connect with a funding expert to discover the options that make sense for you and your business.