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Working Capital Financing Alternatives Embraced By Businesses Denied Bank Loans
Most businesses need short-term working capital financing at some point. With banks refusing to extend credit to even profitable, well-established companies, business owners are finding relief from the cash flow industry and its alternative commercial finance products.
FREDERICKSBURG, VA, January 26, 2011 /Banking and Financial PR News/ -- In the wake of the punishing financial crisis that began in 2008, many business owners and entrepreneurs continue to suffer its lingering effects, unable to meet the financial needs of their companies. Though showing modest improvement in 2010, bank credit remains tight, and for all but the largest firms, reliable sources of traditional working capital financing are few and far between.
Fortunately, the non-bank cash flow industry offers several powerful alternatives to banks, techniques that can provide a steady source of working capital for virtually any business of any size, according to the creator of Smart-Business-Financing.Com and 13-year finance industry veteran, Mike Lieber.
"In this era of tight-fisted bankers, too many good businesses are shutting their doors because their owners don't know about these great alternatives to bank loans and lines of credit," he says.
Using them requires no complicated loan applications, nor does the business have to meet the stringent credit, profitability and asset criteria demanded by banks. Even better, with all of these tools, working capital financing is automatic: The amount of available financing increases as the business grows without ever having to re-apply for additional credit. There are no fixed payments or terms, no payment due dates to keep up with, and these forms of business financing never have to be renewed.
Purchase Order Financing&Account Receivable Factoring
Used together or by themselves, purchase order financing and account receivable factoring are among the most powerful business financing tools available. Together, they can give a business "end-to-end" financing, starting with funding to purchase goods and services from suppliers to quickly and easily collecting profits from its end-customer sales.
"It's hard to find a better solution for a growing company who does not have the current financial capacity to fill large customer orders," says Lieber.
Installment Contract Financing
For businesses that finance their sales through consumer installment sales contracts, installment contract financing provides an easy method to accelerate payment, while avoiding the hassles associated with billing, accounting and collections. Not only can companies selling leisure services, educational products and services, medical devices and services, and the like easily convert all or some of their contracts to immediate cash, they can realize substantial savings by the value-added outsourcing of their account management and collections activities included as part of the financing package.
Credit Card Factoring
Also known as the merchant, or business cash advance, credit card factoring allows retailers who accept credit cards to pledge future receipts in exchange for immediate working capital. While account receivable factoring works with invoices typically generated in business-to-business transactions, credit card factoring provides an immediate lump sum advance against future retail credit card sales. The advance is made at a discount to an anticipated face value of credit card receipts, but rather than collecting on invoices, the credit card factoring provider will be entitled to a small share of its client's daily sales that are paid with consumer credit cards.
Though providing numerous benefits, each of these business financing techniques carries a cost that will vary widely from company to company. Lieber urges all his potential clients to do their homework by using the resources of the internet and by talking to commercial finance experts and other business owners.
"These are excellent tools, but they're not going to be right for every company," he says.
To learn more about these and other business financing solutions, visit www.Smart-Business-Financing.Com or contact Mike Lieber directly at (540) 548-2270.
About AEGIS Financial Solutions, Inc.: Founded in 1998, Mike Lieber's company has been on a mission to help people solve financial problems and get money when they need it most, using the fast and flexible resources of the cash flow industry.
Press Contact:
Mike Lieber, President
AEGIS Financial Solutions, Inc.
88 E. River Bend Road
Fredericksburg, VA 22407
mjl@aegisone.com
PH: (540) 548-2270
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