Will Capital Ever Again Flow Free For Small Business?
An article in today's WSJ begins, "With the worst of the financial crisis behind them, small businesses are eager to grow...".
Let's stop right there. "Crisis behind them"? Behind who?
Numbers can be manipulated in any which way to support any which viewpoint. So, I guess bleek jobs numbers, woeful housing stats, and a host of other dismal news can be pushed aside when a glimmer of hope pops up now and again. But no matter who proclaims the picture rosey red, small business in this country knows better than anyone how precarious the situation is.
The WSJ article reflects a Pepperdine University survey which reveals that though nearly all of the small businesses surveyed (1,200) felt ready to grow again, more than half were still having trouble raising capital.
So banks really haven't loosened up all that much, it would appear. And we can't blame them, I suppose. They are, after all, in business to make money--and in business to stay in business. With the future of global business still standing with one foot in the emergency room, banks can't loosen the reigns just yet. As the article states: A large share of bankers’ loan decisions for businesses is based on cash flows, followed by past operating performance, the report found. Since the downturn, businesses have been hammered by weaker consumer spending, flat sales and lower earnings.
Many businesses have considerable unpaid invoices in a time like this. For them, if a loan or outside investors aren't in the cards, a tried and true approach might be the best option to increase cash flow: factoring invoices. When you factor invoices, a factoring company takes over the invoice for you and pays you the cash you need. Your customer remains in good hands, as the factoring company does not operate as a traditional collection agent. More so, they partner with your business and act as an arm of your organization, handling your client with as much care as you would.
Are you one of those small businesses that is ready to grow? Just need a little infusion of cash to restart the company engines?
Learn more about all of your options.
Reader Comments