Quillhaven Financial sends the request to funding partners and sets it beside revenue-based financing and a loan.
Quillhaven Financial in Huntington, West Virginia can pass merchant cash advance requests to providers; an advance of this kind is not a loan. This page compares it with revenue-based financing, explains the agreement, looks at uneven card sales and the holdback percentage, and converts an invented advance to dollars and days.
At a glance
- Restaurants
Restaurants and other eating places, Cabell County, WV: 222 employer establishments (CBP 2023)
- Retail stores
Retail trade, Cabell County, WV: 396 employer establishments (CBP 2023)
- Drinking places
Drinking places (alcoholic beverages), Cabell County, WV: 32 employer establishments (CBP 2023)
Revenue-Based Financing vs. a Merchant Cash Advance for a Huntington, WV Store
Both are tied to sales, which is why they are confused. Revenue-based financing is generally structured as a loan or financing agreement repaid with a set percentage of all revenue, often monthly, until a cap is reached. A merchant cash advance is a purchase of future card receivables: the provider takes a share of each card settlement until it has collected the agreed amount.
For a store, the difference shows in the paperwork and in the collections. Revenue-based financing usually looks at total revenue, including invoices and cash, and is often reported monthly. An advance looks at card sales and collects daily or weekly from the processor or the bank account.
The article on revenue-based financing and advances compares both through an invented slow month.
Merchant Cash Advance vs. Revenue-Based Financing for a Cabell County, WV Restaurant
A restaurant takes most of its sales by card, every day, which is exactly what an advance is built on. In 2023 the Census Bureau counted 222 Cabell County, WV restaurants and other eating places with a payroll (County Business Patterns). A restaurant considering either option should look at three things: the total amount it will hand over, how fast that amount is collected, and what happens in a slow week.
Revenue-based financing tied to monthly revenue may suit a restaurant with steady catering or wholesale invoices as well as card sales. An advance may suit a restaurant whose sales are almost all card and who wants collections to shrink automatically when sales do. Neither is cheap money; both should be compared with a loan before signing.
Cash Advance vs. Loan: The Agreement a Huntington, WV Owner Actually Signs
An advance agreement is a sale, not a loan. It names the purchase price (the money paid to the business), the purchased amount (the total the provider collects), the specified percentage of receivables (the holdback) and how collections are taken. It usually includes a reconciliation clause, so that if card sales fall, collections can be adjusted to the stated percentage.
A loan agreement names an amount borrowed, an interest rate, a repayment schedule and a maturity date. The borrower owes the full amount regardless of sales. Because an advance is not a loan, its cost is not expressed as an interest rate, which makes direct comparison harder.
Read the agreement for any personal guaranty of performance, default triggers and fees. A lawyer can review terms you are unsure of.
Is a Merchant Cash Advance Good When Card Sales Swing Week to Week?
It can help a business whose card sales move up and down, because the amount collected each day follows sales. In a slow week, less is taken. The same feature means the provider's money stays out longer when sales fall, and the agreed total does not shrink.
Whether it is a good fit depends on the cost and the use. An advance used for a short bridge, such as covering a gap until a known large payment arrives, can be reasonable. An advance used to cover a long decline in sales can leave a business with lower daily cash and the same underlying problem. A second advance taken to cover the first is a warning sign.
How to Get a Merchant Cash Advance and Read the Holdback Percentage
The holdback percentage is the share of each card settlement the provider takes. A higher holdback collects the purchased amount faster, which leaves less daily cash for the business. The factor is the number the advance is multiplied by to get the purchased amount.
- Gather three to six months of card processing statements and bank statements.
- Ask each provider for the purchase price, the purchased amount, the holdback and any fees in writing.
- Convert the offer to dollars: purchased amount minus purchase price is the cost.
- Estimate how many business days collections will take at your average daily card sales.
- Compare that cost and period with a loan or line offer for the same amount.
Providers decide whether to make an offer and on what terms. Quillhaven can describe how an offer is laid out but does not set those terms.
An Invented Advance Converted to Dollars and Days
Illustration only, invented figures: a Huntington, WV kitchen with average daily card sales of $2,600 accepts an advance of $40,000 with an invented factor of 1.32. Over the life of the advance the provider takes $52,800, which puts its cost at $12,800 (our arithmetic).
In the same invented example, at a 12% holdback the provider takes about $312 a day. Collecting $52,800 at that pace takes about 170 business days (our arithmetic, rounded up). If the invented card sales fell by a quarter to $1,950 a day, the daily collection would drop to about $234, and the period would lengthen, but the $52,800 total stays the same.
A merchant cash advance is not a loan, and these figures are not an offer. They show why an advance should be judged in total dollars and days rather than by the factor alone.
Revenue-based financing or an advance compares both structures for a store, and the hood article prices an advance against two loans.
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