Other Millwork (including Flooring)
321918
Pinnacle Bank (SC)
SBA Loans for Other Millwork (Including Flooring): Financing Growth in Custom Woodworking
Introduction
The millwork and flooring industry combines craftsmanship with high-demand construction and remodeling needs. Other Millwork (including Flooring) businesses manufacture custom wood products such as doors, flooring, mantels, moldings, and stair parts. While the sector benefits from steady demand in residential and commercial projects, it’s also capital-intensive and subject to fluctuating material costs. Traditional banks often hesitate to lend due to industry risks, leaving many small shops searching for alternatives.
This is where SBA Loans for Other Millwork (including Flooring) provide a lifeline. Backed by the U.S. Small Business Administration, SBA loans give millwork businesses access to affordable financing with lower down payments, flexible repayment terms, and government-backed guarantees that reduce lender risk.
In this article, we’ll explore the NAICS 321918 industry, highlight financial challenges millwork businesses face, and explain how SBA loans can provide the tools for long-term growth.
Industry Overview: NAICS 321918
Other Millwork (including Flooring) (NAICS 321918) includes companies that produce wood-based products outside of traditional cabinetry or structural lumber. Common outputs include wood flooring, staircases, moldings, mantels, shelving, and decorative millwork. These businesses often serve the construction, remodeling, and interior design markets.
Millwork businesses play a key role in both residential housing markets and commercial building projects. Demand is tied to new construction, home improvement, and real estate trends. However, the industry faces competitive pressures from mass-produced imports, volatile raw material prices, and evolving customer preferences for sustainable or engineered wood products.
Common Pain Points in Millwork & Flooring Financing
From forums like Reddit’s r/woodworking and small business threads on Quora, here are the top struggles millwork shop owners face:
- High Equipment Costs – CNC machines, planers, saws, and dust collection systems can cost hundreds of thousands of dollars, creating high barriers to entry.
- Material Price Volatility – Lumber prices fluctuate widely, leading to unpredictable expenses and tight margins.
- Cash Flow Gaps – Many millwork shops rely on contracts with builders, where payment terms can stretch 60–90 days, creating financing gaps.
- Competition from Imports – Large overseas manufacturers can undercut prices, making it hard for small U.S. shops to compete without financing for efficiency upgrades.
- Traditional Bank Rejections – Many banks see woodworking and flooring as niche or risky, leading to high rejection rates for loans.
How SBA Loans Help Millwork & Flooring Businesses
SBA financing provides solutions tailored to the unique needs of millwork companies:
SBA 7(a) Loan
- Best for: Working capital, equipment, expansions, or acquisitions.
- Loan size: Up to $5 million.
- Why it helps: Funds equipment purchases like CNC routers, refinishing machines, or trucks for product delivery.
SBA 504 Loan
- Best for: Real estate and large equipment purchases.
- Loan size: Up to $5.5 million.
- Why it helps: Ideal for buying or expanding a manufacturing facility, or financing high-value woodworking machinery.
SBA Microloans
- Best for: Startups and small-scale improvements.
- Loan size: Up to $50,000.
- Why it helps: Great for tool upgrades, safety equipment, or marketing campaigns to reach new contractors.
SBA Disaster Loans
- Best for: Recovery from natural disasters like floods or fires.
- Loan size: Up to $2 million.
- Why it helps: Provides recovery capital to repair facilities or replace damaged equipment.
Step-by-Step Guide to Getting an SBA Loan
- Check Eligibility – Must be a for-profit U.S. business, have a credit score of 650–680+, and demonstrate repayment ability.
- Prepare Financial Documents – Include 3 years of tax returns, income statements, balance sheets, and cash flow projections.
- Find an SBA-Approved Lender – Some lenders specialize in manufacturing and construction-related businesses.
- Submit Your Application – Highlight how funds will improve efficiency, expand operations, or stabilize cash flow.
- Underwriting & Approval – SBA guarantees up to 85% of the loan, reducing risk for lenders. Approval takes about 30–90 days.
FAQ: SBA Loans for Other Millwork (Including Flooring)
Why do traditional banks reject millwork loan applications?
Banks see woodworking as niche and vulnerable to raw material volatility. SBA guarantees reduce risk, improving approval odds.
Can SBA loans cover new woodworking equipment?
Yes. SBA 7(a) and 504 loans both cover CNC machines, sanding equipment, finishing systems, and other specialized machinery.
What down payment is required?
SBA loans usually require 10–20% down, compared to 25–30% for traditional loans.
Are startups eligible for SBA loans in millwork?
Yes, but lenders typically prefer applicants with construction or woodworking experience and a strong business plan.
How long are SBA loan terms?
- Equipment: Up to 10 years
- Real estate: Up to 25 years
- Working capital: Up to 7 years
Can SBA loans fund material purchases?
Yes. SBA loans can provide working capital to cover lumber, hardware, adhesives, and other inventory needs.
Final Thoughts
The Other Millwork (including Flooring) industry plays a critical role in construction and remodeling, but owners often face financing challenges due to equipment costs, cash flow gaps, and volatile material prices. SBA Loans for Other Millwork (including Flooring) give small manufacturers the capital needed to modernize, expand, and compete more effectively.
Whether you’re upgrading equipment, purchasing a facility, or funding growth opportunities, SBA financing offers the support to move your millwork business forward. Explore SBA-approved lenders today to see how these loans can strengthen your company’s future.
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