Small business owners have money on their minds.
A new survey by New Jersey-based TD Bank (NYSE:TD) reveals 21 percent of small businesses have sought or will seek a loan or line of credit. Most of them (72 percent) will approach their primary bank.
Other Findings from the 2017 TD Bank Small Business Month Survey
Small Businesses Feeling Optimistic
The study also shows small business owners are upbeat about their growth prospects.
About 46 percent expect to increase revenue or sales in the next year. A majority of them (80 percent) feel confident managing their business finances.
But Challenges Persist
A segment of small business owners (11 percent) however admit they don’t know how to seek credit when they’re ready.
For 34 percent of them, their low personal credit score has affected their ability to get business credit in the past. Worse still, 69 percent of entrepreneurs don’t even know about business credit scores or realize they have one.
It Pays to Gain Financial Knowledge
Whether you are planning to expand your business or fulfill more orders, you may find yourself in need of funds.
Before approaching a bank, it’s best to be prepared and have all the information at your fingertips. For example, it’s extremely important for you to be aware of your business credit score. A business credit score reflects your company’s creditworthiness. So apart from impacting your ability to get approvals for loans, it influences commercial partners when they determine extensions of lines of credit.
If you find out your credit score is negative, there are ways to fix it, too. You may, for instance, limit your credit usage and learn more about soft credit inquiries. These are simple steps that can make it easier for you to fix a negative credit score and secure capital.
TD Bank surveyed 553 small business owners with less than $1 million in annual revenue for this study. Take a look at the infographic below for more information:
Need small business funding but can't qualify for a bank loan? Here are some non-bank small business loans options to consider:
Small Business Cash Flow Loans
Even if your small business is growing, you may find yourself needing extra cash to cover day-to-day expenses such as payroll, rent and inventory, or to pay for short-term projects that could grow your revenue in the long run. Uneven cash flow is one of the biggest challenges of small businesses throughout all industries. In a perfect world, you’d walk into your local bank and walk out with a business loan long before you wound up in a cash crunch. Well, those days are long gone! If you haven’t been in business at least two years, or lack good credit and collateral, chances are a traditional bank loan is never going to happen.
In order to deal with this shortfall, a cash flow loan may be your best option. For this type of business financing, lenders provide you funds and use your future expected cash flow as collateral for the loan. You’re essentially borrowing from cash that you expect to receive in the future by giving the lender the rights to a predetermined amount of these receivables. These are primarily used for working capital or take advantage of short-term ROI opportunities. Your credit scores will usually be checked, but they play less of a role. As the name indicates, the lender is more concerned with inspecting your cash flow (usually bank statements) to approve your application. Turnaround time is another great feature of a cash flow loan, as funding usually takes place in a matter of days.
A cash flow loan may be used for any business expense, but some common uses are:
- Working capital
- High ROI short-term opportunities
- Purchasing highly-discounted inventory
- Business expansion
Short-term cash flow loans are best used for short-term projects that would divert money from day-to-day expenses but ultimately grow your business, like taking on a big contract with a major company or adding extra seating in your restaurant. If you need cash fast, a cash flow loan may be your lifeline.
Small Business Revenue Based Loan
There’s never been a better time or more choices for small and medium-sized businesses that need capital. And what business doesn't? Expanding, purchasing equipment, and evening out cash flow can all be managed with business financing. But business loans from traditional financial institutions are not the way to go for today’s businesses on the grow.
Today’s business owner is constantly on the lookout for growth opportunities and must move quickly to take advantage of them. An opportunity for an acquisition or expansion can arise suddenly and needs an immediate response and immediate cash. There’s also the need to purchase equipment or inventory. And of course, there will always be emergencies and cash flow gaps that need to be quickly managed with working capital.
That’s why revenue based financing & cash flow loans from LVRG are the fastest growing working capital solutions among small and medium-sized businesses. They’re the most prudent option for business owners needing capital to fuel or accelerate their businesses’ growth.
Traditional bank loans are often made for as long as 25 years and require mountains of documentation and financial statements. And then there’s the waiting period, for both an approval and for funding, which can be weeks or months. Don't forget the collateral you'll need for a bank loan, including your home, life insurance policies and up to 30% of the loan amount in cash. Additionally, among banking institutions, the credit turn-down rate for small businesses is rather high (roughly 80%) and doesn't show signs of improving significantly.
Revenue based financing and cash flow loans from LVRG simply makes sense. Whether you need $15,000 or $2 Million, LVRG Funding will provide the financing option that's right for you. Our financing options are tailored to the needs of small and medium-sized businesses, and as a result, offer them distinct advantages:
- They’re made for shorter terms, usually 6 to 18 months.
- They require relatively little paperwork and a simple application to start.
- The underwriting and approval process are designed to provide business owners quick answers.
- Once approved, business owners have their funds in as little as 24 hours.
- Payments based on a fixed percentage of sales.
- Repayment terms are favorable.
- Poor credit is not a deal breaker.
- Financing that doesn’t require any equity.
- Easy qualification process with no personal collateral required
Revenue based financing and small business loans from LVRG can be used for any legitimate business expense, from remodeling or business expansion to buying equipment to launching a new marketing effort. The key here is growth and our business funding options are the perfect solution for business owners looking to take advantage of growth opportunities. These short-term loans for business are popular across every industry and in every state in the U.S. From manufacturing and transportation companies to restaurants and retail stores; short-term business loans are an efficient and cost-effective source of capital, when you need it.
Short-term financing can help businesses build or accelerate revenue in ways they couldn't otherwise. And at the same time, working capital solutions offered by LVRG can help business owners negotiate better discounts or terms with vendors and avoid longer-term charges and fees, saving money in the long run. There’s no question why revenue based loans and cash flow financing are catching fire. They’re the ultimate financial win-win for small and medium-sized businesses.
Small Business Working Capital Loan
Nobody faces more challenges on a daily basis than business owners. In fact, for owners of small and medium sized businesses, handling many different challenges is the source of great satisfaction and some headaches, too.
But when business owners are asked to name their greatest challenge, one thing tends to top the list most often; accessing working capital to manage cash flow. In other words, making sure there is enough capital flowing in to cover everything that needs to flow out.
There are a variety of reasons why cash flow can be a steep challenge for small business owners. Needs can precede revenue. Or perhaps you’re getting paid more slowly than you’d like. Or if you’re a seasonal business, a garden center, for example, or specialize in hardy, cold weather clothing and you have peak sales months which require that revenue to stretch across your off-season months.
Often, business owners can optimize cash flow by negotiating longer payment cycles with creditors and encouraging debtors to pay in shorter time periods. But there are other solutions that can help you sail through the lean months with plenty of working capital on hand: a short term business loan or merchant cash advance.
You can put a small business loan “to work” immediately for your business, whether it means meeting payroll for a few months, negotiating a great deal on inventory for paying in cash or hiring and training those new employees you need. Our business financing solutions for working capital can help you operate without missing a beat or even take advantage of an unexpected or one time business opportunity.
And then there are those costs that no business owner sees coming. The sudden need to replace an important piece of equipment or the need to upgrade technology to improve efficiency and save money in the long run. Repairs, sprucing up the exterior, landscaping, even marketing and advertising can all be critical elements to your brand and your ability to growth the business. In today’s super competitive environment, this is no time to skimp, especially when applying for business funding. Working capital can be just a few clicks away.
We understand that small businesses need working capital to keep their operations humming and to pursue business opportunities as they arise. That’s why we provide working capital to businesses across a variety of sectors, in every state in the U.S.
We also understand that when business owners need financing, they need it now not weeks or months from now. So, we’ve made our application process as simple as possible, with a minimum amount of paperwork and documentation required. You won’t need to spend days and weeks retrieving tax forms and statements. Instead, we’ll talk to you about your business and your vision for the months ahead.
Once approved, you’ll have the funds in your account in as little as 24 hours. How’s that for turnaround? And when we say “working capital,” we mean it. It’s up to you how to best use the funds, for any legitimate business expense.