10 Jul Overcoming Small Business Cash Flow Challenges
Regardless of the size of your business or industry in which you operate, overcoming small business challenges is part of running a successful company. How do you attract and retain talented staff? Can you sustain growth as markets change? Is there a way to engage today’s tech-focused customers? And maybe the most common challenge: how do you maintain steady cash flow when obtaining a business loan seems hard?
Overcoming small business cash flow challenges can be difficult. But non-traditional alternative lending has made things easier for cash-strapped businesses. Businesses are turning to non-traditional lenders to access funding that will help them overcome obstacles and achieve long-term success.
Getting the Funding You Need
According to Moody’s Analytics, the U.S. small business sector has been struggling in light of shifting banking strategies. Companies have been left feeling stuck as banks have become more conservative in how they lend to small businesses. Innovation in the financial technology space has helped to fill this gap.
Alternative lending uses modern technologies to reach borrowers who may get turned away from traditional banks. Whether your loan applications have been rejected, or you don’t have the time to deal with a bank’s application process, alternative lending may be for you. It can help you get approved for a loan and make overcoming small business cash flow challenges a reality.
Easy access to data and advances in automation have been game-changers for the lending industry. The most successful alternative lenders use a variety of information types to identify credit risk. From there, automated processes handle many of the funding details, identifying loan parameters that make sense for the borrower. This functionality results in a much faster and efficient loan application process.
Three Small Business Cash Flow Challenges Where Alternative Lending Helps
Overcoming small business cash flow challenges requires an awareness of what you might be up against. Here are three common problems – and how to handle them:
1. Overwhelming Workloads
In an Entrepreneur report, industry expert Pamela Slim detailed the results of a survey uncovering the biggest challenges small business owners face. One of the most common responses was that they don’t have time to do everything. Small business owners often step in to handle emergencies, while also managing day-to-day operations.
In response, Slim recommended leaders begin overcoming small business challenges by investing in artificial intelligence and automation tools. These changes will help them offload some operations to software that does the work for them.
A growing number of businesses rely on tools to increase efficiency. However, investing in advanced technology is expensive. A small business loan can provide funding to purchase and implement digital hacks, which can help to improve your work-life balance and make your days more productive.
2. Having Cash on Hand
Nothing can hold a business back like money problems. Regardless of the specific business industry, every business operation faces some seasonality. This seasonality can affect income for better or worse, depending on the time of year. What’s more, since small businesses have less stable cash flow than larger organizations, a single bad season or missed payment can have detrimental long-term effects. This ebb is especially problematic, as small businesses often lack the larger client bases needed to sustain operations after a downturn. To complicate matters, small businesses can also be prone to relying on a small number of major clients for their business. This further limits their cash flexibility should something goes wrong in one of those relationships.
This is another example where working capital can assist with overcoming small business cash flow challenges. Whether you lose a big client or have a difficult sales season, you can use a small business loan to overcome a temporary cash flow gap.
3. Launching a New Product/Service
Innovation is key to keep up in today’s marketplace. But small businesses often struggle with launching new products and services because they don’t have the right staff or resources. Besides the inventory and equipment involved, launching a new product or service requires marketing and advertising. The right loan could help you purchase equipment, invest in marketing, and hire additional staff to make your product launch a reality.
The QuickBridge Advantage
Alternative lending is emerging as a natural fit for small business loans. But overcoming small business cash flow challenges isn’t just a matter of getting funding. You need to work with a lender who truly cares about the success of your business.
At QuickBridge, we work hard to provide small business owners with the funding they need to succeed. Our knowledgeable funding advisors analyze your business and get to know you so we can find the right loan amount and term for your business’s unique needs. Contact us today to learn more.