Are you using the right finance?

In times of growth, or even temporary decline, your business may need an injection of funds to aid cash flow. Normally, your first thought may be to get a bank loan – receive a lump sum up front, pay it back in instalments.

However, there are many other forms of finance that you may want to consider, each offering different benefits and each with different costs.

Instead of a loan, it may be that you just require a temporary overdraft to dip into for short term funds. Or perhaps if customers are paying you too slowly, use factoring or invoice discounting to ensure you receive your sales receipts immediately, rather than relying on your customer to pay you.

Alternatively, from an outgoing point of view, rather than buy an asset outright, would it be worth your while to lease it and pay over a number of years?

So before you pick up the phone to the bank manager, you may wish to consider your options.

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