Questions to ask when thinking about Cashflow FinancingPublished on 12th February 2019 - Last update on 25th February 2019
At the heart of your business lies your cash flow, enabling you to support your operating costs and perform all manner of essential projects. But if your cash flow was to slow, especially over a sustained period, it could cause issues for your working capital, affecting your business' long-term growth and sustainability. That’s why applying for Cashflow Finance during the early stages of a cash flow shortfall is so important. Covering a range of different business finance products, Cashflow Finance presents you with the means to target the issues that are affecting your cash flow and provide more financial stability. So if you’re expecting to run into a slow trading period or are currently experiencing problems, here’s what you need to ask when thinking about applying for Cashflow Financing.
- What’s causing your cash flow issues?
- What’s your current financial situation?
- What finance products can I choose from?
- What repayment plans are available?
- Are there any additional costs involved?
Why does my business need Cashflow Finance?
When applying for any finance solution, you need to be fully aware of why it’s required. Cashflow Financing is a business finance package designed specifically to provide financial support and resolve any issues that may be impacting your cash flow. So whether the issues are as a result of a slow trading period, unexpected operating costs or a lack of investment, being clear on which aspect of your business needs support will allow you to begin sourcing an appropriate finance solution.
What’s my business’ current financial situation?
Another aspect to consider when applying for Cashflow Financing is your business’ current financial situation. When applying for most business finance solutions, lenders may ask for permission to review your business’ credit profile and credit score in order the determine the risks that are involved. They will be looking to see whether you have any outstanding CCJs, Arrears, Accelerated Payment Notices and if you have a reliable history of settling your debts. Yet, although having a weak credit score won’t always be used against you, your creditworthiness may affect the interest rate that you are offered with the agreement. Therefore, assessing your business’ current financial situation could allow you to round down your search and possibly source an appropriate and cost-effective solution. If you have any concerns regarding your business’ credit profile, you can read more the subject here.
What business finance solutions are available with Cashflow Financing?
What makes Cashflow Financing so useful is that it covers a diverse range of business finance products that all work in different ways to provide the support you require. Although this is ultimately good news for your business, the challenge is often with identifying an appropriate solution. So if you’re considering applying for Cashflow Finance some of the products you may qualify for could include Business Loans, Merchant Cash Advance, Revenue Advance, Invoice Finance, Asset Finance or Revolving Credit Facilities. Therefore, in order to ensure that your business has an appropriate level of support, you must ensure that you understand the various aspects of these solutions before making your decision.
How are Cashflow Financing solutions repaid?
Because Cashflow Financing covers a wide range of finance solutions, this package is able to offer you a range of repayment schemes, depending on your chosen product. Whilst Fixed Monthly Repayment schemes are the most common, you also have Flexible Monthly Repayments and Deferred Payment to collecting the money owed by your customers regarding any unpaid invoices. Therefore, you need to make certain that you understand each of these schemes in order to ensure that you’re choosing a product that your business can comfortably afford.
Are there any additional costs involved with Cashflow Financing?
In addition to interest, you need to make sure that you fully understand and are aware of all the charges that may be applied to certain finance solutions. Depending on your chosen finance solution, just some the costs and fees that you may encounter can range from arrangement fees, legal costs and administration fees to exit fees. Therefore, as well as reading through all the documents provided regarding the concerned product, you should also consider requesting a face-to-face meeting with the lender so that they can explain all of their charges. Doing so will allow you to determine the overall cost of the agreement, putting you in a stronger position to compare products, or even reduce or negate some of these costs during negotiations.
Thinking of applying for Cashflow Financing?
Although maintaining your bottom line no doubt sits at the top of your list of priorities, it isn’t always a simple matter to achieve. As your business continues to trade you may encounter periods where your cash flow isn’t as strong you need it to be. Left unchecked, this can cause problems for your business which may threaten your growth and sustainability.
That’s why applying for Cashflow Financing as soon as you predict or encounter cash flow issues is so important, allowing you to prevent the issue from causing further harm to your business. So if you’re expecting to face challenges to your cash flow or need help stimulating growth, apply for Cashflow Financing today or find out more with Rangewell.
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