Top 6 Industries That Benefit from Business Loans
6 Key Industries Harnessing the Power of Business Loans
There are many uses for a business loan, depending on the industry. Business financing can help various industries achieve their goals and overcome their challenges. Here are some key sectors harnessing the power of business loans today.
1. Manufacturing
Despite the manufacturing industry seeing a 10.7% increase in April 2023, it still doesn’t eliminate the fact that machinery and equipment are expensive. A recent report found that the rising production costs have compelled local factories to downsize their workforce and hamper their growth. Supply chain bottlenecks also pose a challenge to the manufacturing industry.
Manufacturing loans can help you overcome these difficulties in several ways. For instance, the additional capital can enable you to cover rising input costs while maintaining your workforce.
2. Construction
Experts forecast the construction industry in the Philippines to grow 9.6% by 2025, with the government deeming it a key sector in the country’s post-pandemic recovery.
However, the industry still faces challenges with rising raw materials and equipment costs, as indicated by 58% of construction decision-makers and influencers. It isn’t surprising, especially with inflation rising to brutal heights.
Respondents also highlighted concerns regarding staff management, sustainable competitive bidding, and staying updated with digital transformations. With construction business loans, you can get additional financing to address rising production costs and inflation and fund your construction projects.
3. Agriculture
The agriculture sector of the Philippines is one of the main drivers of economic growth. Many private companies continuously develop innovative equipment to boost the quality and quantity of their productions.
Your agricultural company can apply for a business loan to gain the capital necessary to invest in high-tech, smart agriculture technology, such as a sensor-equipped smart greenhouse that optimizes temperature for crops.
4. Retail
According to Retail Asia, consumer spending is set to grow to 5.5% year-over-year in 2023. Retail business loans can help you position your company to take advantage of the growth in consumer spending in several ways.
For instance, the additional capital can help you stock up your inventory to ensure you have enough to sell to the influx of customers. It may even allow you to invest in product development and research to produce better products for your customers. You can also check these tools for SME growth.
5. Technology
The tech industry is anticipated to grow tremendously in the coming years, with artificial intelligence (AI), 5G networks, and the Internet of Things (IoT) becoming increasingly popular.
Business loans can help your tech company take advantage of emerging technologies, allowing you to automate repetitive tasks and expand your connections with other devices and companies nationwide.
Globe Telecom, a prominent company in the tech and telecom space, leveraged business loans to enhance its operations. In December 2021, the company secured a ₱15 billion loan to boost its capital expenditure, refinance debts, and fulfill general corporate requirements.
6. Restaurant
The restaurant industry was among the most affected by the pandemic, with sales plummeting from ₱3.08 billion in 2019 to ₱1.38 billion in 2020, according to Statista. But as pandemic restrictions ease, industry experts forecast a potential surge in customers engaging in “revenge dining” at restaurants.
You can apply for an enterprise business loan for your restaurant to ensure you have enough inventory and staff to accommodate the rush of customers. Additional financing can also help you afford upgraded equipment to improve the quality of your meals and potentially even expand your menu offerings.