Large companies have always had a number of options that they could depend on to raise capital for their businesses. The have always had access to a number of alternatives such as selling stock, issuing bonds, bank loans and accounts receivable financing among others. Looking at the other side of the coin, smaller companies, those that have between $20,000 and $500,000 of yearly revenues, have always had a challenge trying to find capital to operate their businesses.
The
lack of access to capital has prevented many small businesses from
growing and capitalizing on the many opportunities that are available
to them. It is not uncommon for small companies to reject large deals
or opportunities because they do not have the necessary capital to
obtain the resources to service the account. However, even when small
businesses do take on large contracts, they find that they are never
paid immediately upon delivery of services. Most contract terms demand
that the supplier provide 30 to 60 days for the customer to pay their
invoice - in effect, forcing them to extend them with supplier credit.
The lack of adequate capital resources, along with the necessity to
offer commercial credit to clients, creates a “perfect storm” that
prevents small businesses from growing and that is very difficult to
avoid.
If you are a small to medium sized business, consider the advantages of a Merchant Cash Advance and how it could benefit your business. Call Envision Merchant Capital today at 801-326-0376 for more information.
Comments for Working capital for small businesses.
There are no comments yet.