Growth in a business can depend largely on the businesses financial situation. If you feel that your business is ready for the next step it is often the finances that will hold you back. Expanding your business does mean a certain level of risk but the rewards make this risk worth wile. Other reasons for expanding your business can include:
So if you have decided to take the plunge and grow your business, the next question you will undoubtedly ask your self is what should I do for funding?
Commonly the first place a business will look for funding is the bank. Generally they offer some sort of a business loan which can be what you are looking however there are some potential drawbacks with this option.
Loans not only lack flexibility but also they can be hard to pay back if your customers / clients are not paying you on time. If you are looking at getting a loan for your business it can be confusing to find the best loan for you as so many banks offer business loans it can be hard to pick the best one for you. For more information on finding the right loan for your business please click here.
For those that do not want to go down the loan route there are alternative forms of finance that offer more flexibility. Invoice Finance is a form of cash flow funding that allows a business to use an invoice as security against which funds can be borrowed to them. There are two main types of Invoice finance these are Invoice Discounting and Factoring.
Another form of alternative finance that may be useful to your business is Asset Finance. There are two types of Asset Finance, leasing and hire purchase. With a lease agreement the ownership of the asset in question does not go to the client, instead they may extend the contract or make a one off payment to take ownership of the asset. On the other hand a Hire purchase agreement allows the transference of ownership meaning the client does own the asset; however this will happened only after the client has paid off the remainder of the contract to finance company.
If you would like more advice on alternative forms of finance we suggest that you contact Touch Financial. There team of finance experts can give you advice as well as some lender option and this is 100% free. For more information please visit the Touch Financial website or alternatively you can call them on 0845 388 9725.