Business Credit & Capital No Comments

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Business loans promise to give your company the cash it needs to operate, but you understandably want to avoid going deeper in debt. Keeping a lid on the cost of capital while maintaining enough operating capital can challenge almost any firm, so learn the conditions when taking a business loan makes sense.

You Win a Large Customer or Contract

Small to mid-sized companies often turn down large transactions because they lack the cash reserves to buy the supplies and inventory needed to serve big clients. Cash flow problems can hamper any organizations even during periods of healthy sales. Large companies often expect Net payment terms that further exacerbate pressures on cash flow. Rather than let sales go to competitors, businesses can stop letting opportunities slip away by taking a business loan to maintain cash flow.

Turn a Profit on Cash

Borrowing money makes sense if the money enables you to earn more than you pay for capital costs. You can compare your expected profit margin with your interest rate, or compute the Net Present Value of your project with the Net Present Value of the cash you get from your loan. Regardless, if you can earn more money than you spend on your loan with the money you borrow, taking a business loan might make sense.

You Need Extra Capacity

As your business trends toward growth, your existing team members and their equipment can’t keep pace. With money tied up in inventory and bills coming due, your firm might not have the ability to hire new employees and invest in equipment or facilities. A business loan will supply the cash you need to expand your company without having to turn away customers.

Emergencies

Sometimes emergencies happen. Equipment can fail while processing a job or facilities need repair. Similarly moving your company can cost a lot of money, making a business loan necessary. Emergencies almost always occur at the wrong time, and taking a business loan can help a company survive. Regardless of whether a company truck breaks down or a forklift gives out, a business loan might make sense if no other way exists to pay for repairs. No one can predict the pressures on cash flow that might occur during business, so having plenty of options exist can help.

Available Financing Options

Small to mid-sized businesses have credit and funding options available to them including traditional cash advances and credit lines. ACH programs that apply to firms that do not accept credit card transactions and hybrid programs give companies more options. Canadian businesses can also take advantage of some borrowing opportunities.

Business Credit and Capital helps companies navigate changing economic and market conditions by making loans available to them at reasonable rates. The firm has a fast approval process that gets business owners an answer within two days. Businesses like the simple funding process that requires minimal documentation and, upon approval, can deposit money directly into your business checking account. The financial solutions offered by Business Credit Capital provide needed cash for planned and unplanned expenses, so companies can continue operating without interruption.

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