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. Because of the demand of people and businesses looking for new means of finance sources, we are now hearing various ways of how we can get hold of finance.
It may be a surprise to some businesses that they actually have undiscovered cash reserves that they can use to finance the growth of their company. By allowing your company make some self-financed growth plans, cash can actually be revealed and fused into the system, and this can be accomplished by taking a closer look at credit procedures, how terms of credit are granted and how payments that are outstanding can be chased.
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.
You can also manage well your working capital by not only having better control of debtors and stocks, but also by maximizing your credit terms. 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.
Another means to fund growth, especially with the traditional ways of getting finance are becoming difficult for one reason or another, a business owner can use personal resources to help financial concerns of the company. There are immediate actions that can be done to help funds inflow into your company, such as taking on mortgages on your residential properties, drawing on your cash savings, or using your personal credit cards.
Another easy way to raise finance is to take loans from your family and friends, which may be less stressful but consequences have to be faced like higher interest rate and sometimes risking trust and relationship if something will go wrong.
There is also a called asset finance where the sources are invoice discounting, factoring and funding of asset purchases. In this situation, the asset financier will finance the purchase of vehicles, machinery and equipment needed by a company, and since these assets bought becomes a security, you do not need additional collateral, and thus help preserve your cash for other purpose of funding growth into 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.