As we discussed in part-one, while delayed payment on accounts payable is often accepted among the business community as a fact of life, it can have serious ramifications on small businesses.
There are two types of people in the world. Those who make your life easier — and those who make it harder.
A thriving business' biggest challenge is sourcing a reliable line of working capital finance. This can be the difference between making life easier or harder as finance traditionally requires personal security and is bound by restrictive covenants and conditions. Whether it be covering monthly overheads, funding acquisitions, purchasing inventory or tendering for larger projects, it is imperative this working capital finance solution empowers the business owner to be ambitious and doesn't act as a hindrance. The funding tool needs to give you control, limit liability and of course be cost effective. The following sources are traditionally relied upon in the stated order:
- Extending payments terms to suppliers (also known as dynamic discounting)
- Credit Card
- Director loans
- Equity funding or
- Invoice finance