All business owners would probably prefer to conduct all transactions on a cash-only basis, but that just isn’t realistic because it would tend to limit the volume of sales in your company. By allowing for trade financing with your customers, you make it possible for them to make purchases, or to make larger purchases, than they would have been able to make if all transactions were strictly cash. On the other hand, allowing trade credit to customers can open up a real can of worms, in terms of delayed or late customer payments. Here is how trade financing works, and how you can take advantage of it to help your business grow.
The nuts and bolts of trade financing
By allowing customers to purchase goods on credit, you can enjoy some or all of the following benefits:
- Higher sales volume – customers will almost always buy goods in greater volume when they don’t have to pay cash for them.
- Customer loyalty – the fact that you’re allowing customers to buy on credit will usually instill a certain amount of loyalty in them, so you can count on repeat business
- Competitive advantage – if your rivals cannot offer trade financing, you might get a leg up on them because you do make this option available to customers
- Early payment incentives – you can offer incentives to your customers to pay early, so you’re not obliged to wait the full 30 days before receiving payments. For instance, by offering some kind of discount for early payment, you may be able to get most payments well ahead of the 30-day terms allowed for in such purchases.
Is your business hampered by trade financing late payments?
Many business owners who offer trade financing find themselves with cash flow issues, simply because payments are delayed while expenses remain immediate. If your business is suffering for this reason, we may be able to provide financial assistance. Contact us at My Commercial Capital to find out if you’re eligible for a business loan that can help you stay afloat until revenues come in.
Attorneys often find the majority of their clients through referrals. Even when this is true, they can still benefit from maintaining an online presence. Perhaps your firm could use guidance with online promotional efforts. Here are some marketing tips for lawyers with the potential to attract promising clients.
Include Calls to Action
It’s human nature to follow the path of least resistance. If someone’s on your website and contact information is difficult to find, that person is likely to go elsewhere to handle legal obligations. Contact forms make sending inquiries quick and easy. Incorporate them into every page of your site. If you send promotional emails, provide information on how to get in touch at the bottom of each one. Use language that encourages reaching out. Stress that there is no fee or obligation for consulting with a representative.
Create a Blog
When people face legal problems, they often search the internet for information about their situation before deciding on a lawyer. Have articles addressing relevant topics on your webpage, and those in need of assistance might wind up reading them. Individuals who find your words useful are more likely to solicit your services. Use search engine optimization practices to improve your Google ranking.
Get Involved with Charities
There’s no better press than earned media. Unlike traditional advertising, this type of exposure stems organically from your actions. By contributing to a worthwhile cause, interested outlets will naturally start singing your praises. When reporters come calling, request that links to your home page and social media accounts be a condition of your doing an interview. The charity you’re connecting with is likely to have a website. Ask if the association is willing to promote your services on account of your generosity. Besides the promotional aspect, it nourishes one’s soul to help those in need.
Optimize for Mobile Devices
Many access the web from their phones, not high-end desktop computers. Smartphones don’t display websites the same as their PC counterparts. Smaller screens sometimes make navigation difficult. Limited memory might mean fancy plug-ins and sophisticated add-ons do not work. Your site should look great no matter how it’s accessed. Create a slimmed-down version of your domain that users are automatically sent to when browsing from less powerful devices.
The law is a competitive field. Thus, attorneys should use every promotional advantage at their disposal. These and other marketing tips for lawyers can make an enormous difference in whether they stand above the crowd.
The big advantage of obtaining an unsecured line of credit is that you don’t need to offer any business assets as collateral, which means you can’t lose those assets if you should default on the loan. In most cases though, it means you’ll need a really good credit score to qualify, and you’ll also need to have been in business for several years to demonstrate stability. Some lenders may also require you to have a specific annual revenue income before they’ll consider your request.
Qualifying for an unsecured line of credit
When you apply for an unsecured line of credit, the lender will review the status of your business, and may also investigate your personal income situation. Most lenders want to know that you’ve been in business a while and are an established company, and they’ll also take a good look at your cash flow. If you’ve been regularly experiencing cash flow issues, it will be a definite red flag for the lender. Sometimes a newer business can get an unsecured line of credit by accepting a smaller line of credit amount, at least until they become better established.
Once you’ve been in business for a time and have established good credit, you may be eligible for a larger line of credit. Some lenders also will increase your line of credit after you’ve shown that you can consistently pay back borrowed amounts on the credit line, and are not maxing it out soon after obtaining it. The amount of any line of credit you receive will always depend on the age of your company, your credit history, your business revenues, and your business expenses.
Looking for an unsecured line of credit?
Of course, it’s easier to qualify for a secured line of credit by using business assets as collateral, but if you lack these business assets, you may still want to apply for an unsecured line of credit. Contact us at My Commercial Capital to see if you’re eligible for one of these loans, and our specialists will be glad to work with you in that regard.
Working capital loans can be issued by banks or alternative lenders and their purpose is to cover the short-term needs of a small business. It can temporarily increase cash flow, until revenue streams become more steady and consistent. Most companies that look for working capital loans need them for such expenses as rent, debt payments, wages, inventory, or sales and marketing expenses. Even if your business assets are greater than your liabilities, you may not have the working capital you need, because many assets are not liquid, and cannot be easily converted into cash. Here’s how a working capital loan can help you meet the needs of your small business.
Using a working capital loan
Generally speaking, a working capital loan is used to cover some kind of shortfall in cash flow, and it can be used for almost any purpose whatsoever. One common use for working capital is to purchase additional raw materials from your suppliers, in order to fill an unusually large order. You might also secure such a loan when an opportunity arises to get a significant discount on raw materials by purchasing in volume. When cash flow is lacking, you might need a working capital loan to pay your employees or to manage monthly expenses like utility bills, facility rent, or vendor payments.
It would not be advisable to use a working capital loan for long-term purposes, such as financing equipment or buying capital assets. These things can be obtained by applying for a different kind of loan that would offer more advantageous long-term interest rates and financing. When securing a working capital loan, you will probably need to use business assets as collateral, since unsecured working capital loans will require that you have a very high credit rating.
Need a working capital loan?
If your business is in serious need of more working capital, we may be able to provide the financial assistance you need. Contact us at My Commercial Capital so our financial specialists can work with you to determine your eligibility for funding.
It has been estimated that between 50% and 67% of all small businesses will need business loans at least once during their operating lifetimes, and most businesses actually require several loans during that time. In many cases, working with traditional lenders like banks and credit unions simply won’t work for a small business, because the approval rates are typically low with those institutions. It’s also true that even if you are approved, it will generally take between one and two months before you actually have money in hand. Fortunately, alternative lenders can fill in the gap and provide much of the funding needed by small businesses.
How alternative lending helps
Many new businesses simply don’t have the cash reserves or the good credit history to be eligible for a loan that might be sorely needed. This is when alternative lenders can really fill the void left by all those bank disapprovals. In many cases, banks won’t even lend amounts of less than $200,000 to businesses, because they can’t make enough profit on them. Again, alternative lenders can fill this gap and provide needed funding to small business owners who qualify.
Alternative lenders are not under the same constraints that banks are, and can be much more agile in lending than all the machinery involved in a bank loan. When you need money quickly to take advantage of a sudden business opportunity, you might be able to secure the necessary funding in a matter of days with an alternative lender, as opposed to the weeks or months it would take in a bank loan. You might have to pay a higher interest rate, but that’s because the alternative lender is exposed to the possibility of you defaulting on the loan, and they have to protect themselves.
Looking to work with an alternative lender?
You can often be approved for a loan more readily by an alternative lender than you would be with a bank, because alternative lenders are not subject to the same kinds of restrictions that banks are. If you’re ready to work with an alternative lender, contact us at My Commercial Capital, so our financial specialists can help you secure the funding you need.