Every day, small businesses everywhere move millions of dollars through our economy. While big business would appear to move a lot of money through the system, and they do, the bulk of the money for things being bought and sold takes place through small businesses. Due to cash flow issues such as having outstanding invoices that are slow-pay or the need to buy ahead for seasonal purchases such as Christmas, there are times additional money is temporarily needed. This means you will need to come up with extra funds to leverage that stock until it sells. Being able to have a small business credit line means you can buy the product you need but won’t have to pay for it for a specified period of time.
While many manufacturers and suppliers may extend a line of credit, many times the limit is very low until the small business has proven itself. Seasonal purchases may not only exceed credit limits provided by manufacturers and suppliers but may also exceed whatever limits you have on your business credit cards you have in order to have the stock on hand you need. Taking advantage of a short term small business line of credit can give you the extra funds necessary instead of going through the hassle and the time required to acquire a full bank loan which takes forever to pay off.
Having a hard loan or merchant cash advance like this is actually a quick and possibly best way to leverage a short term situation. Instead of having to make specific payoff dates on a standard loan or even on a regular line of credit, a hard loan can work off of credit card receipts. Instead of having to come up with cash payments at a set time, a percentage of credit card receipts can be routed directly to the loan company. This means no visible cash out of pocket to pay off the loan. That makes paying off the credit line virtually transparent.
A small business line of credit means you’re not only able to leverage your existing stock, leverage seasonal stock but it also means you can pay off the loan while making a profit at the same time. Build your business and client base while making the profits you have always dreamed of.
