While you tend to run your small business on a cash basis, there are times when securing some type of financing would come in handy. Whether the plan is to buy more office furniture and equipment or target a new sector of the consumer market with an ad campaign, the proceeds from the funding will make it easier to start now and reap the rewards sooner. Here are several options for securing those funds that you should consider.
Traditional Bank Loans
One of the more common approaches that comes to mind immediately is a traditional bank business loan. Depending on the type of assets your company owns and how high the business credit rate happens to be, this approach may be fine. Keep in mind that traditional lenders tend to have strict lending policies that could prevent you from being approved even if your company is doing well at present.
Loans from Alternative Lenders
If your business credit score is not the best but the company is performing well after a slow period, alternative lenders are worth checking into. You will find many of these lenders are happy to extend loans even when others turn you down. Thanks to the different type of qualifications that these lenders require, you could have that loan for small business approved in less time than you expected.
Another approach to funding is to put a resource you already have to good use. That resource is the monthly batch of invoices that you send out to clients. There are lenders who will basically purchase those batches and advance you the majority of the face value. Your clients remit their payments directly to the funding partner, who credits them to your account. As more payments come in, most of the remaining income from the invoices is released to you. The partner keeps only a small percentage in return.
Since you don’t have to wait for customers to send in their payments, you can use the money immediately for whatever growth strategy you have in mind. Best of all, you don’t have one more debt to manage each month.
Merchant Cash Advances
Another way to use what you have coming your way is to set up a merchant cash advance. The partner who processes credit card payments to your business evaluates your average monthly income from credit purchases and provides an advance based on that figure. The debt is repaid incrementally as the merchant keeps a small percentage of each payment that is processed. You have an influx of cash now and can rest assured that the debt is being paid off every time a customer pays using a credit card.
Never assume that you can’t secure some type of funding for your business. Talk with a professional today who can help you find the right approach to funding. In less time than you thought possible, the money will be in hand and you can get to work on your revenue generation project.