Utah business owners have one goal in mind: growth. It may not be easy to achieve for small businesses strapped for cash.
How can companies increase their cash flow fast? Here are seven ways:
1. Apply for a Line of Credit from the Bank
Utahns can borrow business loans from banks. However, these debts may carry high interest rates. The application process may also take a while, defeating the purpose.
Company owners can get money fast by securing a business line of credit in Utah. Account-holders can get pre-authorized access to funds using their assets as collateral. These can include inventory, accounts receivable, and equipment. They can then replenish the credit line by repaying. Their interest is up to the borrowed amount only.
2. Sell or Release Idle Assets
Not all assets are useful. The idle ones can incur maintenance and depreciation costs, and these expenses can drain the business coffers further.
Businesses can convert these assets in the following ways:
· Auction these assets
· Sell them in garage sales or online marketplaces
· Trade them for more useful assets, such as equipment or machine
· Use them to pay off creditors
3. Negotiate Supplier Dues
For those who have built a relationship with their vendors or suppliers, they can negotiate their debts.
Owners may ask for a longer payment term. For example, they may ask to change it from 30 days to 60 days. Doubling the time will allow the business to use its profits for other income-generating activities.
Either way, a business that struggles with paying debts need to inform their suppliers right away. Otherwise, the company may face a bouncing check or even a lawsuit.
4. Consider Check Discounting
B2B customers often pay through checks, not cash, to keep their liquidity and cash flow. These financial instruments may also be postdated. The company has to wait for weeks before they can encash them or the funds appear in their bank balance.
To convert these checks into money fast, they can discount them. In this process, the bank provides funds to the account holder against the value of the checks, minus interest payments and other charges. Once the checks clear, they can pay off the rest of their dues to the lender.
5. Advance Cash from the Small Business Credit Card
A small business credit card can also be a financial lifeline. This plastic can help companies track their spending, pay off volumes of inventory, and boost their cash flow. The company can also build their credit history that may allow them to access better business loans.
Entrepreneurs can also use this card to advance cash. The processing time is often shorter than that of conventional business loans. They can also receive up to their account’s credit limit.
Note: Credit card cash advances have high interest rates. Businesses should consider this as a last resort and only when they can raise funds to pay them later.
6. Borrow Money from Friends and Family
Sometimes entrepreneurs need not look far for financial support. Their family and friends can offer them with the cash flow they need. They may even extend help without expecting a return or loan funds without interest.
Money may not be the only thing that makes the world go round, but it helps businesses survive and thrive. Easy and quick access to short-term cash flow can promote unprecedented growth.