Posted by NCF On March 12,2019
Traditional loans are not the be all end all of business financing. With funding limits, debt, and arbitrary interest rate hikes, many businesses are seeking out alternative solutions to the traditional loan model. When it comes to growth capital, merchant cash advances seem like an attractive alternative to bank loans, but there are a few things you should know before you apply for that MCA.
Posted by NCF On March 05,2019
Many businesses use merchant cash loans or merchant cash advances as a means of sidestepping the debt and fixed payments of traditional loans. However, the devil is in the details, and a merchant cash loan can easily place a major strain on cash flow and can potentially threaten to turn business finances upside down.
How Merchant Cash Loans Really WorkMerchant cash loans are frequently advertised as an infusion of capital without debt and lots of flexibility. The balance is repaid from a percentage of sales instead of fixed payments, giving businesses more financial leeway. The reality of merchant cash loans is that, while they may not place any debt on the balance sheet, merchant cash loans have other strings attached. Because they are sold as “a debt-free cash infusion” on the front end, merchant loans come with very high interest rates as well as hidden fees. While the repayment method seems flexible, the interest and fees result in an extremely larg
Posted by NCF On February 26,2019
Staffing agencies operate in a very fast-paced industry. They source individuals to fill roles at all types of companies, ranging from general labor to highly technical fields. In order to sustain operations and grow successfully, staffing agencies need to not only cover their own expenses, but also pay those individuals working in various roles for their clients. With clients paying invoices at varying rates, there are times when cash flow can become turbulent and place a strain on finances that makes it hard to keep things running smoothly.
Striking a Balance Between Services and RevenueMany staffing agencies have agreements with their clients to provide qualified employees for weeks, months, years, or even for a custom duration to complete a specific project. The sourced employees are paid by the staffing agency on a weekly or bi-weekly basis. On the other side, cli
Posted by NCF On February 19,2019
When businesses position themselves for growth, the thought of taking out one or more loan is not far behind. For the longest time, debt-based loans have been the answer for everything from overcoming cash flow issues to expanding into new markets. However, business owners spanning all industries are rethinking the traditional growth financing model.
The Limitations of Debt-Based FinancingGrowth-focused businesses want to reach their fullest potential. Loans may seem like the conventional method to attain growth capital, but they can also be very limiting. Taking on debt to achieve growth usually means businesses have to walk back a few goals in order to pay off the balance of their loans without creating a severe financial strain. Debt and impacted credit ratings add to the risk of business growth when the end result does not guarantee a proportional increase in sales to offset financial liabilities. In the end, the accumulated debt can keep businesses fro
Posted by NCF On February 12,2019
Manufacturers of all types are facing increased demands from their clients. Whether it is ductwork for HVAC installations, specialized electronics, widgets, or finished products for general consumer use, production expenses are on the rise. Manufacturers need a robust cash flow to purchase raw materials, acquire or maintain equipment, and hire employees to ensure operations run smoothly. When clients are settling accounts at intervals of 30 days or longer, this can disrupt the normal workflow for manufacturers. Fortunately, there is a simple solution.