With the holidays upon us, it can mean a slowing down for your business. But for many it can mean just the opposite, especially in the B2B sector. With a last minute rush to fill big orders companies can often find themselves in need of a cash injection. When you have large orders to fill at the last minute funding can be hard to find. There are a number of funding options available to companies throughout the holiday period, finding the right one for you can be tricky. In order to select the best funding option that is available to you, you must first understand what each option has to offer and how it can help improve your cash flow and ultimately your business. Below are some of the most popular funding methods that are readily available to businesses throughout the UK.

Your options

Invoice finance – A system that essentially allows you to use your outstanding invoices as an asset, against which funds can be borrowed to you. This process is great if you are looking for funds to be released to you immediately and can allow you to focus more on your business and less on debts. There are two main forms of Invoice Finance, Factoring and Invoice Discounting.

  • Invoice Discounting – A system of cash flow funding that works by releasing funds you have tied up in invoices. It works by using the invoices as collateral against which finance can be borrowed to your company. Instead of waiting up to 90 days for your outstanding invoices to be paid, you will be paid within 24 hours from the lender. You will be responsible for collecting your own debt and retain control of your sales ledger.  This system is confidential and your customers will never be aware of a lenders involvement.
  • Factoring – Just like invoice discounting this system is about utilising the funds you have tied up in unpaid invoices, its key difference is that this method is not confidential and your customers will be aware of the lenders presence in your business. This is due to the fact that your clients will be paying directly to the lender and not your business. This option is great for SME’s as it allows you to focus on your business without worrying about chasing payments, also just like Invoice Discounting The funds will be released to your company within 24 hours.

Trade Finance – A particularly useful method of funding for companies looking to fill big orders during the holiday period. Trade finance helps to increase a company’s buying power by allowing advanced orders to be met with a lender paying for the goods on the company’s behalf. This will then be repaid over an agreed period between the lender and the company.

Each of these funding options offers something different and unique for your business. Determining which one is right for you can be a challenging task. Touch Financial, an established financial brokerage firm have the experience and knowledge to point you in the right direction and by simply calling in to them on 0845 388 9725 you could be securing your businesses future, alternatively for more finance options please visit their website on www.touchfinancial.co.uk.

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