Your business deserves a great start to the New Year and what better way to begin than by making sure it's well-funded.
Maybe you're looking to expand, improve cash-flow or pay HMRC or VAT bills? The good news is that proper financing of these expenses can help you to focus on what you do best and run the business.
Why not reduce your stress levels and free-up cash within the business and perhaps use those funds to market your services or acquire new equipment to improve efficiency and bottom-line profits.
So where do you start when you look at funding options?
Business loans are available but does your business suit the demands of underwriting from banks and other lenders? Here's some useful information on what you should consider..
1. BUSINESS LOAN
Standard Business Loans are the obvious place to start. They are popular and can be straightforward if your business and personal credit history is good, if the business is in good shape and there's nothing on the horizon that would give concern to a potential lender.
Business loans will allow you to borrow money and spend it on whatever you need without giving away any equity in your business.
2. MERCHANT CASH ADVANCE
This can be a good way for a business that doesn’t qualify for a traditional business loan, to get a cash advance - basically a lump sum payment from a lender upfront. The loan amount is steadily repaid over time with the lender taking an agreed percentage of business transactions. This makes it an alternative option that matches business cash-flow. There fees of course but it could be an option worth exploring.
3. INVOICE FINANCE
Healthy cash-flow is king in any business and is often a big hurdle for many small businesses to overcome.
Being paid on time is critical and it is not uncommon for small business to often be stuck with poor payment terms. Waiting to be paid is a big problem, so invoice finance could be a handy solution.
With invoice finance, businesses are able to receive a percentage of the invoice amount from a lender upfront (generally up to 95%), then the remaining portion of the funds once the invoice comes through - minus a fee or charge.
Invoice financing is similar to having a line of credit in that it allows on-going access to funds. Invoice financing also offers immediate access to money.
4. EQUIPMENT LOAN
Equipment loans are a type of business loan which can be used to assist with purchasing items like farm and heavy equipment, vehicles like cars or vans and even office essentials like computers and printers. They are typically secured against the asset they’re being used to purchase, so you won’t be required to put up security of your own like you would with a secured business loan. However, if you do fail to meet your repayments the equipment could be repossessed.
5. LINE OF CREDIT (Business Overdraft)
Unlike a business loan, a business overdraft is a funding option that businesses can have at their disposal on an on-going basis. This means that you can use it as a financial safeguard for your business and use it whenever needed and only pay interest on the amount used.
Positive Business Funding can help you find fast funding for any business purpose.
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