The recession changed things dramatically for most small businesses, and the restaurant industry was no exception. It has created a different landscape for business owners in terms of credit options and overall profitability. But our industry is nothing if not resilient; many restaurateurs have sprung back from the challenges of the financial crisis, finding new and different ways to make their businesses thrive.
Before the financial downturn, business was booming and the industry was riding high. Owners had the confidence to take risks, open more locations, and offer premium products and service to a moneyed clientele. Many small restaurants were even able to use personal credit to back their businesses, and banks were relatively flexible with financing options.
Canadians as a whole did not suffer as much as our neighbours to the south, but the recession was still a time when consumers tightened their belts, and dining out was one of the first luxuries to get cut from family and corporate budgets. The downturn hit our industry hard. Restaurants changed their business models, downsized and closed. It was a difficult time to be serving food – people simply weren’t spending.
|The economy has recovered since, and so has the industry, to a large extent. But the recession has definitely left its mark on the way we do business. Banks have lost their flexibility. They want more security, so they have tightened up their requirements, added restrictions, and are generally a lot less free with their loans. Plus, Canadian banks have always been more conservative than their American counterparts. Which means we did not feel the impact of the recession as severely, but it also means it is that much harder for restaurant owners to get the funds they need. Investors are now similarly risk-averse. So in this financially conservative atmosphere, there simply are not as many ways of getting money. So how do restaurants survive?|
|These days, restaurant owners must find alternative ways to fund their businesses, which requires some creativity. Here are a few ideas to help curb your financing woes:|
The recession created new financial challenges for restaurant owners everywhere. But the surviving and thriving eateries out there are showing us that there are definitely options that work, and that these new challenges can be overcome with a different approach and some innovative thinking. So what ideas do you have for finding funds in this risk-averse reality? Comment below and let us know!
About the author:
Liz Teodorini is Marketing Director at iCapital a hassle-free and flexible financing solution for Canadian small businesses. The company, which is committed to being Canada’s most caring and responsive loan-alternative provider, frequently publishes articles relating to small business finance.
|Copyright © RestoBiz. All rights reserved.|