Overcoming Challenges on the Road to Business Growth

Posted by NCF On April 08,2021

Growth allows businesses to create more jobs, take on more and larger client accounts, and tap into new markets. Business growth is a great goal, but too frequently things like cash flow, debt, and capital reserves keep companies from reaching their milestones. Thankfully, there is a way to overcome those challenges and achieve rapid business growth.

The Drawback of Using Loans for Business Growth

In the past, businesses used loans to achieve growth. While the function of loans hasn’t changed, the lending landscape certainly has. Banks and other business lenders have tightened their requirements. Businesses need higher credit ratings and more collateral to qualify for loans. At the same time, banks have reduced loan amounts, making it more difficult for businesses to secure the capital they need to achieve growth. Additionally, debt-based solutions limit the growth potenti


Achieving a Better Sales to Revenue Ratio

Posted by NCF On March 25,2021

Businesses across all industries are balancing sales and revenue to optimize cash flow. However, the sales to revenue ratio can get skewed when payment windows are staggered by a month or longer. Fortunately, there is a solution that can rightsize cash flow and bring the sales to revenue ratio back into focus.

Understanding the Sales to Revenue Ratio

When you purchase something from a retail store or a restaurant, goods are paid for and the business received revenue immediately at the cash register. For other businesses, such as manufacturers, suppliers, maintenance companies, law offices, and more, invoices are issued after a sale is made. Those invoices have staggered payment windows of 30, 60, or 90 days. This means that customers have a month or longer in which to pay for the goods or services they purchased, all while businesses are spending money to cover overhead, pay


Preventing Business Bankruptcy in an Unpredictable Economy

Posted by NCF On March 18,2021
As we enter the first year anniversary since the start of the COVID-19 pandemic, businesses are still facing challenges to maintain cash flow and prevent bankruptcy. Take heart! With increased vaccine production and distribution, it looks like everyone has entered the homestretch to get “back to normal.” Fortunately, there are ways for businesses to prevent bankruptcy as we approach the finish line. Loans and Business Bankruptcy When the pandemic hit, businesses struggled to maintain sales while trying to pay off existing debt. At the same time, banks tightened their credit and collateral requirements, making it extremely difficult for businesses to take out short-term loans to smooth over uneven revenue cycles. The first round of PPP loans offered very limited support, and while the economy is slowly entering an uptick, businesses are looking for cash flow solutions that are not debt-based so they can preserve credit and collateral while avoiding bankruptcy. Cash Flow

Running Your Business Without Debt-Based Loans

Posted by NCF On March 11,2021

For the longest time, loans have been a necessary evil in order for businesses to maintain and grow their operations. In fact, loans have become the default, all-purpose solutions for everything a business needs, whether it’s using short-term loans to smooth over revenue cycles, extra capital to purchasing assets, or as a means to supplement capital reserves to roll out plans for growth.

But are debt-based loans really necessary?

The Drawbacks of Using Debt-based Loans

Regardless of how loans can help in the short-term, there is no way to avoid the negative impacts they have on businesses. Debt-based loans require collateral and lower credit ratings, making it more difficult for businesses to secure financing in the future. And of course, loans place debt on the books. This means that businesses using short-term loans to overcome cash f


Smoothing Out Uneven Revenue Cycles

Posted by NCF On March 04,2021

All businesses experience uneven revenue cycles, which can greatly impact cash flow and prevent companies from thriving and growing. While many businesses use short-term loans to overcome these recurring obstacles, the debt and impacted credit ratings can create an even larger problem. Fortunately, there is a way to smooth out uneven revenue cycles without negatively impacting finances.

What Causes Uneven Revenue Cycles?

Uneven revenue cycles can be caused by many things. Unexpected business expenses, unpredictable economic downturns, unconsolidated debt – any and all of these things can disrupt cash flow. Even during high sales periods, the total payments received from customers can be well below the calculated revenue due to staggered payment schedules. The most common cause of uneven revenue cycles occurs when revenue is tied up in unpaid receivables with staggered paymen

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