Purchase orders, invoices and assetsEven if you have limited assets, a purchase order from a strong buyer gives you a firm financial leg to stand on. Purchase orders are a great first step into trade finance. As long as you have more than a 30 per cent margin on the order in question, it can help secure finance for trade, either domestically or internationally. Similarly, the invoices you send to other businesses can also be a strong base for securing finance. This can be as little as a single one off invoice, or the whole sales ledger. Invoice finance can release up to 90 per cent of your sales ledger and the highest level of funding for your business. Finally, assets whether existing or to be purchased can provide the backbone of security for lending. The kind of assets that provide this security come in a range of shapes and sizes, from machinery, stock and property, all the way through to a company van. The key here is simply to understand the value of what you have.
Card machinesFor small businesses in the hospitality and retail sectors, such as pubs, hotels and shops, securing funding can be notoriously difficult. What a lot of these businesses don’t realise, however, is that with just four months trading, and 4, 000 of revenue coming through a card machine per month, they can secure funding under the promise of future cash flows. This can be up to 150 per cent of monthly takings and presents a useful funding opportunity to any smaller firm regularly using a card machine.
StartupsStartups find themselves in a unique position, but it neednt be a desperate one. Most startups founders think that without a solid revenue stream, financing is going to be an uphill struggle. In reality, a solid business plan is far more important. The vital element is to ensure financial projections are both comprehensive and achievable. The last point isnt just crucial for startups. Solid financial projections are indispensable for any firm seeking finance, and speaking to a professional on the subject is certainly advisable. Your accountant is a great place to start, and will likely give valuable advice about your next steps to finance. The moral of the story is that, no matter the business, there is almost always a hook to secure finance. The real issue comes in finding the lender that suits you, and an ever increasing number of small business lenders, it can often feel like the waters are being muddied. Aggregation platforms offer a way to clear these waters and make funding choices more transparent. Paul Surtees is managing director and co-founder at Capitalise.com Read more on the?growth opportunities out there for fintech startups.
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