This calculator from Cedarmark Advances, a small-business funding service in Anderson, IN, takes the amount, factor rate and holdback from a merchant cash advance offer, plus average daily card sales, and estimates the total remitted, the cost and the business days to completion. It does not compute an APR or make offers.
What the Calculator Needs
- Advance amount: the cash the funder pays you
- Factor rate: the multiplier in the offer, such as 1.30
- Holdback percentage: the share of daily card sales the funder keeps
- Average daily card sales: from your recent processor statements
The calculator multiplies the advance by the factor rate to get the total collected, subtracts the advance to get the cost, and divides the total by your daily holdback to estimate the number of business days.
What Is a Holdback Percentage?
The holdback, sometimes called the retrieval rate, is the percentage of each day's card sales sent to the funder until the purchased amount is collected. As an illustration with invented figures, a 10% holdback on a $2,000 sales day sends $200. With a true holdback, slow days send less and busy days send more. Many advances instead use a fixed daily or weekly bank debit; for those, enter the debit as a share of your average daily sales to get a rough estimate.
Worked Example
Invented figures for illustration. A quick-service restaurant is offered $15,000 at a factor of 1.32 with an 11% holdback. Its card sales average $1,800 a day. Total collected: $19,800. Cost: $4,800. Daily holdback: about $198, so collection takes roughly 100 business days. If the same cost were spread over 100 business days, that is about five months, a short period for a $4,800 charge.
Compare that with what a working capital loan for the same amount would cost in total. The kitchen's broader funding picture is on restaurant funding.
What It Does Not Do
It does not convert a factor rate to an APR, include fees charged by the funder, or account for days with no card sales. It does not make or predict offers. Merchant cash advances are explained in full on the merchant cash advance page, and other tools and guides are on the guides page.