Funding routes for a takeaway or fast food business
Most takeaways are small family businesses with a short balance sheet: a lease, a kitchen full of equipment that secondhand buyers price brutally, and profits that look thinner on paper than the queue on a Saturday night suggests. Banks read that paperwork and hesitate, which is why takeaway owners so often fund growth from the till or from family rather than from a lender.
The realistic options run as follows. A term business loan is the cheapest structured money if the accounts support it. Asset finance covers fryers, ovens, extraction and refrigeration, secured on the kit. A merchant cash advance converts the card and app takings already flowing through the business into a lump sum, repaid as a share of daily settlement. And supplier credit from wholesalers remains the most underused free funding in the sector.
The right one depends on what the money is doing. Kit that lasts ten years suits finance that runs years, not months. A rush repair, a refit before a lease renewal or stock and staff for a new opening hour pattern suit money that arrives in days and repays out of trade.
An advance on card takings, in plain terms
A merchant cash advance is a purchase of future card receivables. A funder pays the takeaway a lump sum now and collects an agreed percentage of daily card settlement until a fixed total has been delivered. It is not a loan, so there is no interest rate, no APR and no fixed monthly repayment.
The cost is a factor rate, typically 1.1 to 1.5 on the sum advanced: take £15,000 at 1.3 and £19,500 is repayable in total. The pace is the holdback, typically 5 to 20 percent of each day's card takings, collected by an acquirer split or daily direct debit. Advances run from £5,000 to £500,000 and are usually sized near a month of card turnover.
For a takeaway the daily percentage is the part worth dwelling on. A quiet Tuesday costs you a small amount. The Friday rush carries the load. Nothing about the repayment fights the natural shape of the week.
Delivery platform payouts and what a funder counts
The modern takeaway has two tills. There is the counter terminal, and there is the weekly payout from Just Eat, Deliveroo or Uber Eats, arriving after the platform has taken its commission. On a delivery-led site the platforms can be half the turnover or more, and how a funder treats that money decides how much you can raise.
Most funders will read platform payout statements alongside merchant statements and size the advance on the combined flow, though some price the platform element more cautiously because the payout arrives weekly rather than daily and sits behind the platform's own deductions. A site that is heavily dependent on one platform is also carrying concentration risk a funder will notice: if the account is suspended, most of the revenue stops.
Practical advice: bring both sets of statements from the start. A takeaway showing £12,000 a month through the terminal and £14,000 through platforms is a materially different proposition from the terminal alone, and the difference is usually the gap between a useful offer and a pointless one.
Fryers, ovens and extraction: equipment at short notice
Takeaway equipment fails at the worst possible moment because the worst possible moment is when it is working hardest. A fryer range that dies at six on a Friday is not a maintenance item, it is the weekend's takings gone. The same is true of a pizza deck, a charcoal grill, a doner machine or the extraction system a landlord or environmental health officer has just condemned.
An advance suits these moments because underwriting runs on merchant statements and typically completes within days. It also fits planned spending where the payback is quick: a second fryer range to cut Friday queue times, a faster oven, a refrigerated prep counter, air conditioning for the kitchen that keeps staff through summer.
For a single large purchase bought new, compare asset finance first. Hire purchase secured on the equipment is often cheaper because the lender holds security. An advance wins where the spend is mixed, urgent, or includes things no lender will secure against, extraction ducting and shopfitting among them.
Working capital for a weekend-weighted week
Takeaway cash flow concentrates into the weekend, but rent, wages, energy and supplier accounts spread across the month, and energy in particular has become a serious fixed cost for a kitchen running fryers and ovens all evening. The mismatch between when money arrives and when it leaves is where most short-term pressure comes from.
Because the holdback is proportional, an advance leans on the strong days automatically. It also fits the sector's seasonal swings: the January trough after Christmas trade, the World Cup summer that doubles wet-led sites, the student cycle in university towns.
The honest limit is the same one we give every trade: the total repayable does not shrink in a quiet month, you simply carry it longer. If the business loses money across a full cycle, funding is not the fix and we will say so rather than arrange something that makes the problem worse. Our guide on whether an advance is right for you is the place to test that honestly.
The cash question: card mix decides the offer
Takeaways were one of the last cash strongholds in British food, and some still run a heavy cash mix. That matters here more than in any other part of the assessment, because an advance is sized on card takings alone. A shop turning £30,000 a month but putting only £9,000 of it through the terminal will be offered a number that reflects the £9,000.
The shift since contactless has been dramatic and mostly one way. Sites that moved to card-first at the counter, with delivery apps on top, now often show ninety percent of turnover in fundable form. If your card mix is still low and you want funding sized to the real business, the practical step is simply to run more of the trade through the terminal for three months before applying, because funders size on the most recent statements.
Cash-heavy owners should also weigh a conventional loan instead, where bank statements rather than merchant statements carry the application. We arrange both, and the statements usually make the choice for you.
Buying, refitting or opening a second shop
The classic expansion moves in this trade are taking over an existing takeaway, refitting a tired site, or opening a second shop on the strength of the first. All three run into the same wall: the price of entry is real money up front, and the accounts of one small shop rarely persuade a bank to fund the whole of it.
An advance underwritten on the existing shop's takings can carry part of the stack: the deposit and legal costs on a lease assignment, the refit while the accounts catch up, the first months of wages at the new site. Size it against what the proven shop comfortably supports on its own, not against projections for the new one, because the holdback comes off the proven till regardless.
For first-time buyers with no trading site to underwrite, an advance is not available, because there are no takings to buy yet. The realistic pre-opening stack is personal capital, a start up loan, asset finance on the kitchen and supplier credit. Once the terminal has three months of history in your name, the picture changes: our new business cash advance page covers how short a history some funders accept.
A term loan against an advance for fast food trade
Where a takeaway qualifies for a bank term loan at a sensible rate, that remains the cheapest money, and nothing in this page argues otherwise. The friction is qualification and speed: filed accounts that understate a busy shop, security requests, personal guarantees and a decision measured in weeks.
An advance is underwritten on the till, not the accounts, which is why approval rates in this sector are high and why a shop with a patchy credit file behind it can still be funded. It completes in days, takes no charge over the family home, and flexes with the week.
Compare the two on total cash out, not on rates, because a factor rate and an APR are different measurements and converting one into the other misleads in both directions. Ask each provider for the total repayable and the period it realistically runs, then compare those two figures. The cost and comparison detail lives on our sister site's business cash advance pages, which exist for exactly that arithmetic.
Fish and chips, kebabs, pizza, chicken: trade notes
The underwriting pattern is common across the counter trades but the details shift. Fish and chip shops carry the sector's heaviest equipment costs in ranges and filtration, and the strongest case for asset finance alongside an advance. Kebab houses trade latest and lean hardest on weekend nights, which reads well on daily settlement but concentrates risk into a few hours. Pizza shops are usually the most delivery-led, so platform payout treatment matters most to them. Fried chicken shops often run the highest transaction counts at the lowest average ticket, which is the steadiest settlement pattern of all.
Chinese and Indian takeaways frequently combine an older cash base with a fast-growing app trade, and the statements often understate the true business, which is worth talking through before an application rather than after an undersized offer. Dessert and bubble tea shops trade like cafes as much as takeaways, with daytime card volume that funders read comfortably; the mechanics on our cafe funding page apply almost unchanged.
Not a loan, and not FCA-regulated: the position
Because the funder is buying future card receivables rather than lending, an advance to a limited company sits outside the Financial Conduct Authority's consumer credit perimeter. It is an unregulated commercial agreement between businesses: no APR disclosure, no cooling-off period, no automatic ombudsman route. The contract is the protection, so read it, and in particular how takings are defined, whether platform payouts are included in the definition, whether the holdback can be changed, and what a personal guarantee attaches to.
A large share of takeaways trade as sole traders or family partnerships rather than companies, and that changes the legal position: agreements with unincorporated businesses can fall within the Consumer Credit Act at smaller sums, which brings disclosure obligations and protections with it. If the shop is in your own name, ask the funder in writing which regime the agreement sits under before signing. A funder who cannot answer that question crisply is telling you something useful.
How we arrange funding for counter trades
We are a broker. We arrange and place with funders, we do not lend, and the funder pays us rather than you. In this sector the comparison worth paying for is between funders who read platform payouts generously and those who ignore them, between acquirer-linked programmes attached to the terminal you already run, and between factor rates that look identical until you put total repayable next to holdback.
Send three to six months of merchant statements, the same period of platform payout statements if you deliver, recent bank statements and a plain answer on what the money is for. What comes back is a short list compared on the two numbers that matter, total repayable and daily percentage, with a straight recommendation, including the recommendation to use asset finance or a term loan where that is the better structure. The neighbouring trades read differently: see restaurant funding for table service and cafe funding for daytime trade.