Industries / Restaurants and hospitality
Restaurants and hospitality: card batches, seasons and the stack.
Restaurants, bars, lodges, cafes and caterers. Why this trade is the most stacked in the country, what the daily card batches tell an underwriter, and the facilities that get an operator back to 1 monthly payment.
What the read looks for
4 things an underwriter reads in this trade before the application.
The bank statements are read first in every trade. In this 1, these are the 4 patterns the read is looking for, and the 4 things to have explained before you send the file.
The card batches
Daily processor deposits are the cleanest revenue evidence in any trade: date stamped, third party, hard to fake. An underwriter reads their level, their weekday pattern and their trend across the months requested.
The season
A lodge with 4 strong months and 8 quiet ones, or a restaurant that lives on summer traffic, is read across the full cycle. Send 12 months if the business is seasonal, so the low months are seen in context rather than in isolation.
Tip payroll and the negative days
Payroll with tips, sales tax and the liquor distributor are the debits that produce negative days. The count of those days, and whether they cluster in the off season, decides how a facility is sized.
The lease
Most operators rent. A lender then underwrites on equipment, receivables and cash flow rather than real estate, and reads the lease term against the facility term.
The common position stack
The advance is sold on the card receipts, and the second 1 arrives before the first is paid.
How the stack usually builds in this trade, and the way out of it.
A processor offers an advance against the batches, a slow January follows, and a second funder offers to cover the first's daily debit. By the third position the remittances take a share of every day's sales before rent. A buyout retires all of them at closing, secured on the equipment and the business, and puts the operator back on 1 monthly payment sized to the batches.
Facilities that fit
3 structures that match the trade.
Structures, not offers. Every facility is arranged through third party lenders and is subject to their underwriting and approval. Which 1 fits is decided by the file, not by the page.
Position buyout
Every position retired in full at closing, 1 monthly payment, underwritten on the batches and the assets.
Read more FacilityWorking capital term loans
A fixed monthly payment for a remodel, a second location or an off season, sized on deposits.
Read more FacilityLines of credit
Draw, repay and draw again through the season, for an operator with the statements to support it.
Read moreQuestions from the trade
Answered straight.
All of our revenue is card batches. Is that a problem?
It is the opposite. Processor deposits are the evidence underwriters trust most. The read focuses on their level and consistency, and on the debits that leave before the owner sees them.
We rent our space. Can we still get a buyout?
Yes. Buyout facilities are underwritten on business assets and cash flow: equipment, receivables and, in some structures, a blanket lien. Real estate helps at the top of the range but is not required.
Is a reverse consolidation the same thing?
No, and the difference is the whole point. A reverse consolidation puts new advance money into the account to cover the existing debits while every position stays alive. A buyout pays every position off. Read the brief on the 2 before signing anything.
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Start with the file
A straight read within 2 business days.
Send the basics through the intake form: what the file supports, what is missing, and the next step if there is one. If we are not the right desk for it, we say so.