If you own your own business, you are probably no stranger to the roller coaster of challenges that come along with operating one.
From paying employees, managing invoices to suppliers and working out schedules, a business owner really has to be a pro at much more than just their industry.
Of course, you also know the amazing feeling when your business grows sustainably, when employees are happy and working well, and when your work and life balance is in order.
But when things do get tough, there are avenues to make life easier. Commercial loans are just one possibility. Here’s what you should know.
Commercial loans are not necessarily just for purchasing commercial property. Many business owners apply for a commercial loan to assist with cash flow, to purchase capital equipment, and to assist with other aspects of running their business.
It can be difficult for a business owner to pay his or her debts when they are waiting for their own invoices to be paid.
This cash flow issue is common among small to medium sized businesses in Australia, and can put a real strain on an operation.
According to the Courier Mail:
It is estimated that almost half of small businesses have more than $20,000 in overdue payments, and 60 per cent of business owners say the situation is only getting worse.
This year, there was an inquiry into the issue of cash flow within small businesses and thousands of submissions were received from concerned business owners in Australia.
It’s important to know that if you are experiencing issues with cash flow, you are not alone, and most importantly, there are sustainable solutions.
Debtor finance allows a business owner to take out a loan against the debt they are already owed.
Put simply, you receive a percentage of the debt you are owed from a lender, so you can pay your own debts. Then when the invoices due to you are finally paid, you can use those funds to repay the lender.
This is a surprisingly sustainable way to grow a business, as you are never borrowing beyond what you are owed. It also allows you to continue operating when cash flow is poor.
Growing a business sustainably is one of the biggest hurdles operations face. How do you deliver on your first major project when you don’t have the equipment to complete it?
If you don’t have the equipment, how can you get the money from the new project and grow your business further? It’s a business catch-22.
This is where equipment loans are useful.
Many businesses secure equipment loans when they need machinery or equipment for a job that is beyond their usual scope of operations.
The new equipment enables the business owner to complete the new project, and in turn, take the business to a new level.
Equipment loans are also useful when old equipment needs to be refreshed, or when a project relies on specialist machinery.
These kind of loans can be strategic, especially if you know that more income will result from the project the equipment is required for.
We have commercial loan specialists who can help you secure a business loan that saves you more, and matches your business goals.
Contact us to schedule a meeting with our commercial broker. We can come to you, at a time that works for you.
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