Five Ways Alternative Lending can Boost Your 2015 Small Business Revenue
June 20, 2015
Picture this: your company is relatively new on the block, and has started gaining ground on the competition in terms of market share. However competing firms have started expanding their operations response to your company’s emergence. Keeping up with the competition will require “upholstered” marketing and operational plans as well as new structures, all of which point toa sudden need for sizable funds.
The world of business in itself, is a series of calculated risks and pushing forth with large purchases can sometimes entail the need for the involvement of third-party lenders. Alternative lending may be the ideal option given this scenario. The same goes for a lot of companies affected by an economic recession. Alternative lending offers an easy and flexible payment scheme, much to the convenience of enterprises in need.
1. Pay your loan back as you get more sales
For a budding company, especially one that keeps pace with the advancements in 2015, acquiring and installing all the necessary equipment would require a bulk of cash. The first thing that comes into mind is getting a business loan. Alternative lending, in the form of aMerchant Cash Advance, can present an easier loan payment method, thus allowing new enterprises to borrow more funds.
Since the payment is staggered – based on the arrival of credit card sales – those who opt for alternative lending have the luxury of borrowing large sums of cash, which can be turned into additional staff, machinery and even a financial pillar for expansion. In a nutshell,the success of your company figures in paying for the owed sum, a far cry from the terms that usually come with traditional financing.
The resulting financial freedom allows new companies to manage their cash flows, make valuable purchases and fill up all their basic staffing needs with relative ease. Partnered with an in-demand product/service and a series of sound strategies, an enterprise should likely experience a progressive growth in sales to cover for the amount owed in the long run. Your success is the alternative lender’s success, to put it simply.
2. Easier to manage your cash flow
Without the proper grasp of one’s cash flow, an entrepreneur will be surprised at the sudden surge in expenditures and perhaps forgo necessary spending in favor of the perception of preserving business capital. It’s tough to run a business if you have no idea whether you’re making money out of a particular venture. Here is where cash flow management and lending come in.
Upon noting down all of the company’s sources of income and expenditures, you’ll have an idea on where you should concentrate your funds, prepare for future expenses and consider possible loans. Alternative lending enters the fray with smaller daily collections, which are easier to manage than a staggering figure payable at the end of the month. Payments are relaxed and come with smaller amounts, giving business owners more control over their finances.
This way, companies can allocate small loan payments daily, without getting in the way of their operational necessities.
3. Fewer requirements than a bank loan
New forays into technology, like big data and digital marketing, can turn a budding enterprise into a well-oiled profit generating machine. The thing that stands between a company and those high-tech amenities, however, is a sizable amount of cash – which not all companies have, new ones in particular.
Normally, a generous bulk of funds can be doled out by a lending company if an enterprise has a favorable credit score. Gaining such takes time, putting new companies at an immediate disadvantage. Alternative lending, through anunsecured business loan, is the golden ticket in this scenario.
An unsecured loan has lower credit and income requirements, fitting the needs of new companies that are experiencing progressive growth, albeit small scale. The interest rates may be higher than secured loans, but if your business has taken on a rather profitable path, paying for your dues would not be too troublesome in the long run.
4. Fast to secure alternative loan funds
Let’s take a look at some of the requirements for traditional business loans. Banks and financiers would necessitate an entrepreneur to hand out their tax returns, credit history and rating, a comprehensive business plan and so forth. This tedious process takes time and effort, which could have been focused on essential endeavours, such as improving the business process or attracting more clients.
Fortunately, this is not the case with an unsecured loan. This type of loan though tagged with more risk does not always require tax returns, credit card processing and complex paperwork. In less than three weeks, a qualified organisation can already obtain much needed funding from an alternative lender, thus propagating more focus toward growing the business and not on the loan.
5. Alternative loans make it easier to run a successful business
Starting a business is easier said than done, since most ventures come with an array of expenses that not every budget can afford. Even if you have just enough to cover the initial expenditures and the operating capital, the cash-outs expand over time and new ventures don’t always prove to be successful at first. Don’t fret, it’s not the end of the world; far from it to be honest.
Financial institutions that provide alternative lending allow prospective business people to follow their entrepreneurial dreams and perhaps make it on the industrial front. The terms they provide are geared to accommodate the financial capacities of these business owners. The small daily payments from an unsecured loan don’t make large dents on one’s finances while the stretched payment scheme of a Merchant Cash Advance lets a new business grow before compelling large settlements.
The initial stages of putting up a business are often the hardest, and a new entrepreneur would love to have as much breathing room as possible in terms of cash. Alternative lending, for many, happens to be that breathing room.
Or call 1300 760 930 to speak with one of our friendly Lending Consultants now.
More like this
Australia’s first online small business lender launches new Affiliate Marketing Portal to provide a killer alternative to the Big Banks
Capify, Australia’s most experienced Fintech online business lender, has launched its new Affiliate Marketing portal this week. “In Australia, Fintech’s need to think fast, and innovate faster. The affiliate portal has derived from the growth we are experiencing in the affiliate and broker market. We want to work with local […]
More and more SME owners are turning to online lenders for their business loans, and there are some very good reasons for that. Possibly the biggest reason – the one that leads to all the others – is that online lenders have built their businesses to serve SMEs. They understand […]
Small business profit peak trading is a dynamic and lucrative time for profits. Set your SME up for peak profitability over small business peak trading periods with these handy hints. As you limber up to capitalise on enhanced retail activity, be sure to consider: Staff penalty rates Small business peak […]