Business Loan Options for Business Expansion
Financing the growth of your business isn’t difficult, but it does require some planning. The biggest issue is that traditional business loans don’t usually provide flexible working capital, which is what you usually need when planning a big move that could let your business expand further into the marketplace. There are loan products and alternative financing options that provide these resources, though. You just need to know where to look to find the kinds of lenders that provide those services. You also need to research your plan for business growth, to see if traditional loans might play a role in financing new facilities or equipment.
Once you understand where you might use traditional secured business loans, it’s easier to map out the territory where you will need other options to cover your financing. Among those options are lines of credit that can work like revolving loans, providing a cash draw when you need working credit. These are good options because they are reusable. Any time there’s a balance, you can use the working capital to fund more business growth. Whether it’s inventory, supplies, or increased staff for an anticipated event, you can flex to reach it. For a similar flexibility in a one-use option, consider the hard money loan or the bridge loan.
There’s also inventory financing for credit and loan options that use your current assets like inventory, invoices, and equipment to determine your available credit. They can be costly because of the constant administrative upkeep, but they give you a resource that provides a little extra credit on top of your other options when you need to dig deep. If you’re looking for a one-use financing option for your assets, factoring can give you an opportunity to tap your invoices for working capital so you can accept new jobs while still awaiting payment. This provides business growth opportunities by making sure you can always get a portion of your invoice balance in your pocket when you need it, so you never have to turn an order away.
Finding the right balance of options for your next phase of growth means making a roadmap of the moves that lead to your goal. Once you have that map, you can determine what expenses your cash flow and reserves can absorb, what you will need to finance, and how to match the best financing option to your needs. It’s also important to remember that there are non-loan tools available. For example, if you’re looking for equipment but you don’t want to commit to a long-term investment and payment plan, you can always lease what you need for the duration of your project, or lease and upgrade after each term for equipment you use every day.