Sableshire Advances passes the request to advance providers, who decide on any offer.
A sale of future card receipts, not a loan, worked through on invented hardware store cases: lumber stock, payroll, an insurance premium and supplier terms. The factor fixes the cost; card sales set how long collection runs.
At a glance
- What it is
A purchase of future card sales
- Cost
Advance times the factor, fixed at signing
- Collected
A daily share of card receipts
Card sales set the pace: how long a merchant cash advance runs at a Chillicothe, OH hardware store
With an advance, the calendar is not fixed. The provider takes a set percentage of each business day's card sales, so the number of days it takes to collect the agreed total depends on how much the store sells by card.
| Invented daily card sales | Collected each business day | Business days to collect the total |
|---|---|---|
| $2,150 | $193.50 | 119 |
| $1,700 | $153.00 | 150 |
In this invented case the store takes $17,500 for lumber stock at a 1.31 factor with a 9% holdback, so $22,925.00 is collected in total and the advance costs $5,425.00. At the lower sales level, collection runs 31 business days longer, but the dollar cost does not move.
Store payroll from a card-sales advance or from a credit line: the cost side for a Ross County, OH hardware store
Payroll can be covered either way, and the two price out very differently. In an invented case, a hardware store needs $9,600 for a payroll run.
- Advance: at a 1.22 factor, the provider collects $11,712.00 from card sales, a cost of $2,112.00 however soon or late the sales arrive
- Credit line: a draw of $9,600 at an invented 13.9% annual rate, paid down after 40 days, carries $146.24 of interest, before any fees the line has
- The line needs a limit already in place; the advance needs steady card sales
On these invented figures the line costs far less for a short payroll gap, provided the store has one open and can pay the draw down. Draws and paydowns on a credit line are traced month by month on the line of credit page.
Lump sum in, daily card share out: a merchant cash advance from start to finish at a Ross County, OH hardware store
- The store calls or sends the short request, and Sableshire Advances passes it to advance providers
- Card-processing and bank statements covering several months may be part of a provider's review
- An offer, if one comes, sets out how much is advanced, the factor and the share of daily card sales the provider keeps
- Once signed, the provider sends the lump sum to the store's account
- Each business day, a share of card receipts goes to the provider, by a split at the card processor or a set debit
- Collection stops when the agreed total has come in
For card-taking counters, the 2023 County Business Patterns give a sense of scale: Ross County, OH had 122 restaurants and other eating places (NAICS 7225) with paid staff. A counter that rings up most of its sales by card is the kind of business an advance is built around, and so is a store that sells lumber, paint and tools at a register. In ZIP 45601, ZIP Code Business Patterns counted 124 accommodation and food services employer establishments for 2023, with an under-five-employee share of 18.5%; the Chillicothe, OH page tables that ZIP by sector.
Pricing the factor on an advance against lumber stock at a Ross County, OH hardware store
In this invented case, a 1.27 factor on a $22,600 lumber order puts the collected total at $28,702.00, a cost of $6,102.00, and that total is set the day the agreement is signed. A 1.36 factor on the same invented amount means $30,736.00 collected and a cost of $8,136.00, or $2,034.00 more.
A factor is not an annual rate. It cannot be set beside a loan's rate until the store works out how many days collection will run, which depends on card sales.
An insurance premium paid with an advance: why a sale of card receipts differs from lending in Ross County, OH
The provider is buying receivables that do not exist yet, which is why this is not a loan; it carries no interest rate, no monthly installment and no date by which it must end. What the store owes is the agreed share of sales until the total is in.
In an invented case, a hardware store takes $7,850 at a 1.24 factor to pay its liability insurance premium. The provider collects $9,734.00, so the invented cost is $1,884.00, whether collection takes three months or six.
On the hardware side, the 2023 County Business Patterns list 20 building material and supplies dealers (NAICS 4441) with paid staff in Ross County, OH. A premium at one of those stores can go on an advance or on a working capital loan, and the offers are worth comparing on total cost. For the fixed-payment side of that comparison, the working capital count article shows what a 9-month and a 36-month loan each do to a hardware store's balance sheet.
The daily holdback percentage, worked through on supplier terms at a Ross County, OH hardware store
Each business day, the provider keeps a fixed slice of card sales, and that slice, stated as a percentage, is the holdback. A higher holdback ends collection sooner but leaves less of each day's sales for supplier bills.
| Holdback | Collected each business day | Business days to collect the total |
|---|---|---|
| 12% | $228.00 | 64 |
| 8% | $152.00 | 96 |
In this invented case, the store takes $11,400 at a 1.28 factor, so $14,592.00 is collected either way, on invented card sales of $1,900 a day. With supplier invoices due every 30 days, the 8% holdback leaves $76.00 more per business day for those payments.
The calculator on this page takes the advance amount, the factor, the holdback and average daily card sales, and shows the total remitted, the cost and an estimate of the business days.
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