Credit Card Receivables Company Business Plan and SWOT Analysis

Credit Card Receivables Company Business Plan, Marketing Plan, How To Guide, and Funding Directory

The Credit Card Receivables Company Business Plan and Business Development toolkit features 18 different documents that you can use for capital raising or general business planning purposes. Our product line also features comprehensive information regarding to how to start a Credit Card Receivables Company business. All business planning packages come with easy-to-use instructions so that you can reduce the time needed to create a professional business plan and presentation.

Your Business Planning Package will be immediately emailed to you after you make your purchase.

Product Specifications (please see images below):

  • Bank/Investor Ready
  • Complete Industry Research for the Industry
  • 3 Year Excel Financial Model
  • Business Plan (26 to 30 pages)
  • Marketing Plan (24 to 28 pages)
  • 425+ Page Funding Directory
  • PowerPoint Presentation
  • Loan Amortization and ROI Tools
  • Three SWOT Analysis Templates
  • How to Start a Business Guide
  • Easy to Use Instructions
  • All Documents Delivered in Word, Excel, and PowerPoint Format
  • Meets SBA Requirements

Almost every retailer and service provider these days accepts credit or debit cards. Given the ubiquitous nature of the Internet, online banking, and the availability of secure payment technology – retailers, physicians offices, contractors, and every other service provider in the United States typically does accept some form of electronic payment. The number of people that carry cash to make purchases on an ongoing basis is somewhat low. As such, credit card receivable financing companies have been developed in order to provide a form of unsecured financing to small business owners. Although this is an expensive form of credit, it does not require very much paperwork and the loans are typically considered to be nonrecourse.

Generally, the interest rates associated with a loan provided by a credit card receivables company is typically around 10% to 15%. This is a significant drop from many years ago when interest rates were often in the 20% to 30% range. Given the substantial amount of competition, the interest rates associated with a credit card receivables loan or a merchant account advance loan have declined sharply. It should be known that credit card receivables financing companies are sometimes revert to his merchant advance companies as well. The startup costs associated with a new credit card receivables financing company typically is around $1 million to $10 million depending on the base of capital that is going to be used and provided to small business owners. The technology that is associated with the operations of these business is now very commonplace, and these businesses can be started very quickly and at minimal cost.

A credit card receivables company business plan should be developed in order to showcase to private investors the anticipated financial results of the business over a three year to five year timeframe. This business plan should feature a profit and loss statement, cash flow analysis, balance sheet, breakeven analysis, and business ratios page. One of the important things to know within the business plan is to have a very well-developed marketing plan, which we will discuss below, in order to ensure that small business owners can be quickly targeted for merchant advance loans. It should also be noted that many of these businesses only target small business owners that have been in operation for at least two years and are currently profitable. New businesses are not going to be able to sustain the capital requirements of most merchant loan companies. It is not necessary to put in the full procedures and protocols regarding the company’s lending practices into the business plan, but it should be made available to a potential private investor.

A demographic analysis showcasing the types of small business owners will be targeting them in the marketing campaign should be included as well this should focus significantly on industries covered, annual revenues, annual estimated profits, and the amount of money that they receive through the use of electronic transactions. A competitive analysis can also be developed to showcase other merchant loan advance companies as well as credit card receivables financing companies within this market. Although this is a relatively small industry, the high gross margins from lending products has driven a number of competitors – including traditional banks – into this market.

A credit card receivables financing company SWOT analysis should be developed as well. As it relates to strengths, these businesses generate very high gross margins from the ongoing lending against receivables from electronic sales. The startup costs are relatively low, and once established these businesses do enjoy moderately high barriers to entry.

For weaknesses, given that this is a nascent form of lending there are going to continue to be changes in regulations in regards to how these businesses operate. However, these changes are expected to be somewhat small given the fact that this is commercial lending which does not have the same level of regulation regarding loans that are provided to individual borrowers.

For opportunities, credit card receivable financing companies can readily expand by simply expanding their access to capital in order to provide a greater degree of loans. Once these businesses are highly established they can have access to capital from traditional financing institutions that will extend a working capital line of credit or warehouse line of credit that is based on loan volume. In some cases, merchant advance companies and credit card receivable financing companies will partner with financial institutions to actually to actually act as an originator of these financial products rather than as a direct lender. This can be a highly lucrative opportunity for many smaller merchant advance companies.

For threats, outside of changes to regulation or a major economic recession – there’s very little about this industry that is going to change moving forward. The technology that guides these businesses is in place, and only moderate changes in the technology moving forward are expected.

A credit card receivables financing company marketing plan should be developed as well. This marketing plan should focus substantially on maintaining a large-scale online presence will also engaging in a broad-based traditional marketing campaign. Many merchant advance companies and credit card receivables companies typically will use mailers directly to registered small business owners in order to create interest in their financial products. It should be noted that one of the most expensive aspects to these companies operations is there marketing campaigns given the tremendous amount of competition within this industry. An entrepreneur should be prepared to spend at least 10% to 20% of the startup capital and at least 5% to 10% of ongoing revenues on marketing related activities. The company’s website should be mobile friendly and heavily search engine optimized so that people can very quickly find lender on an ongoing basis. A qualified web development firm can create an e-commerce focused website that allows potential borrowers to register for a merchant advance loan or credit card receivables financing loan directly on the website. It should be noted that these websites typically cost around $5,000 to $20,000 depending on the amount of functionality that is going to be embedded into the platform.

One of the other ways in which these businesses market their services is through social media platforms including FaceBook, Twitter, LinkedIn, and related platforms. Many businesses will join small business communities in order to increase the visibility of the brand name at the onset of operations. Social media marketing can be tedious but the results can be phenomenal if it is executed properly. Given the substantial cost associated with marketing, some credit card receivables financing companies will hire either an in-house social media consultant or outsources worked with third-party firm in order to minimize the lead-time between creating content for social media platforms and receiving a response from potential borrowers.

Almost every small business owner has a need for capital from time to time, and merchant advance loan or credit card receivables financing loan can be an outstanding way to go very quickly source capital without having to go through a substantial amount of hurdles in order to obtain a traditional business loan or small business administration loan. These businesses can be highly lucrative given the fact that interest rates are often five points to fifteen points above the prevailing prime interest rate. However, the competition in this industry is expected to intensify given the fact that any lender can very quickly participate in providing capital to a small business owner. This is going to be one of the fastest-growing segments of the overall financing industry moving forward.