How businesses can overcome cash flow hurdles
For seasonal businesses, companies going through explosive periods of growth, or organizations otherwise in some form of transition, traditional lending options aren’t always viable. Bank loans and other established methods for securing capital can be too restrictive and can require a pristine operating track record that companies in transition often lack.
The answer to the cash flow concerns of many organizations, especially asset-heavy organizations, is one type of alternative financing called asset- based lending (ABL). ABL is a revolving line of credit based on a business’ accounts receivable, inventory, or other approved collateral. Businesses can tap into these resources to facilitate expansion or get over a hurdle, such as an unexpected downturn in sales or loss of a key client. These solutions can also fund growth initiatives or even replace an existing line of credit.
While many finance chiefs are well-versed in traditional lending sources, ABL may not be part of their usual playbook when evaluating funding options. Or, they may have outdated ideas about non-traditional lending being out of reach due to high fees and burdensome reporting requirements.
This white paper will discuss the details of asset-based lending, tips for evaluating if it is the appropriate option for your business and situation, and strategies for finding the right alternative funding partner.