Which Bear Business Loan is your perfect partner?
Throughout your company lifecycle, as your business ages, its needs will change too. Getting the right business loan is a bit like finding the right relationship. Below we’ll chat about each business stage and the possible Mr or Ms Right to suit.
Mr Kick-Start Cash
In the beginning it can be quite difficult to secure a business loan. Unless you have a steady income, or you have 2 years of company returns, you’re going to struggle. You do have alternatives, for example you could secure a collateral loan against the equity in your property, assets or other investments. This is where you pledge the asset to the bank, securing the loan against it, until the loan is repaid. If the loan is not repaid, the asset can be seized by the bank, however these ‘secure’ loans are more likely to be flexible and have higher approval ratings.
Ms Flow Cash
So now your business has started to gain some momentum, but something happens, something that nearly always happens; an unexpected turn of events has
drained your cash flow. What might be a handy buffer in these tricky situations is a business overdraft. These commercial loans act like a line of credit that you can draw down in times of need. They offer fast, flexible and usually low-cost ways to manage any nasty surprises.
Mr Grow Cash
You’ve got to the point where you’re a mean, lean, business machine but you’re ready to grow a little taller or wider! Maybe you should consider a Term Loan, with fixed repayments and a fixed length of time These loans can help invest in faster equipment or moving to some larger premises. Usually secured against an asset, they’re fully drawn advances to help you advance your business. However, you may need to consider the oil baron Paul Getty’s famous words “if it appreciates, buy it, if it depreciates, lease it.” Lease finance can work well if all you need is an upgraded photocopier that can be traded in, in a relatively short time.
Ms Plan B
Regardless of what kind of business you are, it’s always important to have a plan, plan ahead and have a good exit strategy… because things don’t always go according to plan. Your financial forecasting needs to be kept in check within your current and future capacity. Lenders also look at your plans to make sure you have things in place for when things go wrong. They look favourable on the planners and it helps their decision to help you out.
Mr Debt Cash
If you’re in the professional services industry, you’re most likely to be sending out your invoices every month, in a batch. Usually these have 30 or 60-day terms. However, customers may not always be that quick to part with their cash and sometimes things can drag out or completely stall. This effects your cash flow and can have a knock-on effect to your bottom line. The answer could be Debtor Finance. We’ll go into this in a lot more detail on another post. The basic principle is to leverage your invoices as an asset against a credit advance. Debtor finance can help in three ways; by funding, credit advice and collections assistance.
Ms Right Cash
As with all loans, finding the right broker can speed up your decision-making process, minimising loan application times and costs. This also helps to lower your risk, leaving less chances of being left on the shelf! We can be an integral part of your future growth and partner in your success. Contact us today to chat further.