There are many reasons why businesses experience a short fall in cash flow. Sometimes the cash crunch comes because of growth and sometimes it comes because of a decrease in business or payments. Either way it is a struggle to keep up.
Just starting out – When starting your business there are many different avenues you can turn to for initial start up capital however you may not want to use your retirement or give away equity. Also, many banks have requirements about how long you have been in business and profitability requirements.
Growing your business – Not necessarily a bad reason to fall into a cash crunch but sometimes it can be difficult to keep up with the increase in business.
Extending terms – More and more larger companies are extending their payment terms from 30 to 60 to 90 and sometimes ever 120 days from the invoice date.
Bank line not able to keep up – When growing your business sometimes your bank line is not able to keep up due to lending requirements.
Change in ownership – If you are looking to buy out a business partner, extra cash on hand can be a little tough.
How does National Factoring Association Help?
National Factoring Association can help to alleviate some of the “cash flow crunch”. We have done the research, compiled the information, and sort through the factoring companies based on your criteria so that your business can quickly and efficiently find the best factoring company for your business and its needs.
Interest rates are going up which means money becomes more expensive. If you are considering factoring, now is the time before interest rates go up more.