At some point in time, a person or a business would struggle and need to access sufficient finance in order to maintain ways of living or sustain a business. With several firms and people actively searching for different sources of finance, we are seeing nowadays different manners how we can access finance.
Companies may not have discovered that they have on hand some cash reserves, and this is one source that can finance growth of a company. Know that you can unlock your cash and release it back to your operation by allowing your company undergo a self-finance growth plans, and this can be done by reviewing closely at some credit procedures, how the terms of credit are granted, and how to chase outstanding payments.
Another way to improve internal finance is through better inventory management by keeping stock at an optimum level, so as to minimize trapping of cash and use out some to support and finance growth of the company.
By maximizing the terms given by your creditors, you will be able to manage you’re your working capital, which is not only about better control of debtors and stock. You cash position can have a positive impact if you can take full advantage of the payment terms that your suppliers may be willing to give, like 35 to 45 days instead of paying before the due date.
If the traditional avenues of getting funds is becoming difficult to a certain company, personal resources of the owners can be used to fund growth. Instant solutions like drawing on cash savings, using of personal credit cards, or taking mortgages on residential properties, are helpful to fund growth.
Considered as a less stressful way of raising finance for your needs is to go to your friends and family, although in this case you may have to be ready to pay a higher interest rate.
There is also a called asset finance where the sources are invoice discounting, factoring and funding of asset purchases. In this mode of finance, you will have an asset financier who will buy the machinery, equipment or vehicle needed for your company’s operation, and these bought assets are at the same their security, thus you do not have to provide additional collateral plus you get to keep your cash and use it for funding the growth of your company. With a faster flow of cash inside the business, and this is being done by accessing cash that are tied up in the debtors’ books, there will be available cash to finance needs of the company.