Article provided by Merchant Capital
Alternative lender, Merchant Capital, has launched an innovative short-term finance product to give the hard hit restaurant sector a much-needed injection of working capital to help ease the economic impact of the national lockdown regulations.
“The product, RE-BOOT, will allow successful applicants to buy stock, pay wages, boost deliveries, deep clean, and any other necessities in the weeks to come,” says Merchant Capital Co-founder and Chief Relationship Officer, Ryan Cohen.
This product will be available to restaurant businesses with an average pre-COVID monthly card turnover of R300 000 or more, and will provide capital at regular intervals, based on an assessment of the restaurant’s delivery/take-away revenue growth week by week. To qualify, businesses will either have had to offer delivery pre-COVID, or have added a delivery offering since the relaxing of lockdown.
“A lot of our merchants are in the restaurant industry, which has been among the worst impacted by the lockdown regulations. With so many restaurant owners fighting for their lives, we’re trying to help where we can, to keep their businesses afloat through the crisis,” said Cohen.
A survey conducted by Stats SA during the lockdown and post-lockdown highlights the extent of the issue. The latest edition of the survey asked businesses how the current crisis affected their operations in the two-week period from 14-30 April 2020. Almost half of responding businesses (47.9%) have temporarily closed their doors, and nearly one in 10 have ceased trading. Only half expect their workforce size to stay the same, and five in six businesses (89.6%) have experienced a drop in turnover.
“While our focus remains on being a responsible credit provider, Merchant Capital’s founding principle is to support small business in good times and bad. Without working capital, many restaurants will not be able to re-open even for deliveries, pay their debts, or support their staff,” says Dov Girnun, Merchant Capital Founder and CEO.
Merchant Capital had previously announced a payment holiday for the majority of its client base, predominantly from the retail sector, for the duration of the lockdown. The payment holiday applied to all small businesses deemed non-essential under the lockdown regulations. Over the past seven years, the company has assisted more than 7000 SMEs with working capital to the tune of more than R1.5 billion.
To help small businesses stay afloat in the current economic climate, Merchant Capital has set up a dedicated COVID-19 section on its website to deal with individual business circumstances. The platform contains a variety of resources to help small businesses access relief funds, content, and tips and advice to get through the pandemic.
For any restaurateurs wanting to apply for the Merchant Capital Reboot product, visit www.merchantcapital.co.za or call +2711 217 2880.