Other options to Invoice Finance
Improve cash flow without Invoice Finance
- You can put more of your own money into the business ?
Maybe you have no access to any more of your own money or you do not wish to personally act as a bank.
- You can approach your bank to increase your overdraft?
Perhaps you already have and the bank is unwilling to increase the facility without further personal guarantees and second charges etc
- You can delay paying your suppliers?
This is the cheapest form of finance in monetary terms in the short term but by delaying paying suppliers your name becomes tarnished, you will be unable to demand top service and ultimately your suppliers will increase their prices to you to reflect having to wait for their money. There is a possibility you will be put "on stop" forcing you to find an alternative supplier or pay. In either case there is disruption to your business.
- You can look to raising a loan?
There are loans available for businesses and currently SME's (Small to Medium-sized Enterprises can take advantage of the Government-backed Enterprise Loan Scheme (details further in this site). However, any loan is for a fixed amount and takes no account of fluctuating business.
- You can encourage your customers to pay sooner?
Good credit control is essential in any business, but it is time-consuming, however, cash into your business is vital. So any slow payers need chasing
- You can consider raising finance in some other way?
There are of course many ways to raise finance when the need arises - e.g. stock finance, sale and leaseback, just in time purchasing methods reducing cash tied up in stocks etc. But none of these will reflect an ever-changing trading position like finance directly linked to the amount your customers owe you and the rate of growth you are experiencing.