At some stage of life, all the small businesses owners find themselves in a place where they are short on cash of fulfilling their financial obligation they need to find ways to raise cash to run their businesses. So many options surround us, but we just need to look in the right direction. All you need to do is sit down and look for all the sources. Here are eight alternative methods which you could use to raise cash for your business.
1. Business Cash Advances:
Many merchant account companies are offering “merchant advance cash” and other digital payment methods to providers to lend advance cash against your future credit card sales receipts,” but it’s considered as an expensive way to raise money. These companies are now offering more attractive programs to apply for and get the cash for your business which are known as “working capital loan” or “line of credit.” This loan works on the terms that you get the money in advance and repay the loan from your future sales. Although you have to pay a fee for the advance to process the applications as it involves some paperwork. You can also apply for business cash advance online which will take a few minutes of yours.
2. Deferred Card Payments:
All the credit card companies and charge card companies are offering deferred payment option to their customers, and some electronic payment solution companies are also offering deferred payment options to the customers’ to easily pay for the item and commit for the future dates to pay back. Mostly retail business revolves around this.
3. Loans from Online Loan Sites:
Whenever you feel like applying for a loan, your local banks must be the first place to pop up in your mind, but there are a lot of loan aggregator websites where you can submit your application and loan documentation. These websites declare the loan giving decisions in a matter of hours or days. On the other hand, your local banks might take weeks to give you the decision for loan approval.
If businesses are looking for some small business loan which is usually under $50,000 these loans fall into the category of microloans, they are easy and fast to get as compared to the traditional loans. There are many companies offering microloans to the small business so they can run their day-to-day activities.Click here to learn more about small business loans.
- Factor Invoices:
Not every business need to do factoring, but if your business has a large number of receivable invoices and customers are not paying timely, factoring can help you to increase the process of collecting money from your customers.
6. Sales and Annual Discounts:
Don’t forget that customers are also a very quick source of raising funds for your business. By conducting a big sale on the products/services offered by your business can results in raising a good amount of money. It is not compulsory for you to be in the retail business to take advantage of this. If your company is offering any professional services, you can put on discounted offers for the potential customers who pay for those services in advance for quarterly or annually basis.
7. Home Equity Loans:
Just like every other businessman you won’t be the first person to apply for the home equity loan to get through the crisis in your business. If your business is worth the risk, then it is the best alternative method to raise cash for your business. If you have home equity and your business was doing great in the past, it is considered as one of the fastest sources to arrange funds for your business. Most of the successful small businesses have seen the success because of these home equity loans. Some business owners don’t want to put their family in danger that’s why they don’t find home equity loans worth the risk.
8. Credit from Vendors:
Some of the vendors have started their own financing programs and methods to help other businesses raise their capital for example: If you have always been good customers to your vendors, they might offer you extended dates for repayment. The suppliers have their own programs for repayment methods such as “pay on scan” in this method retailers will pay for the inventory to the supplier after the entire inventory sold to the end customers. The benefit of this method includes that the operational a carrying costs are reduced to a minimum number or eliminated due to higher sales. Under varying circumstances, you can also negotiate on the extended repayment terms with the vendors.
David Simmons is a financial analyst and accounting expert. He has in-depth knowledge about setting up small businesses as well as creating profitable investments. He regularly contributes articles related to business and loans at https://www.ebroker.com.au/.