What happens when you have a cash flow problem for your business? You have orders coming in. Your product or service is doing fine. But there’s a lag between when you will get money and when you need to pay money. And that means you need to turn something liquid quickly. If you haven’t run into this situation before, you may not know which techniques to turn to. When you start searching, however, you’ll see that three things immediately become possibilities.
Which one of these seems like it might be the best idea for you in this circumstance? First, you can utilize the liquidity of pawnshops. Second, you can get a quick small business loan. And third, you can talk to your friends and family about fronting you some cash for a short time.
These three ideas can get you over a quick financial hump better than most others. There are, of course, more complicated options, but these can end up with a very short turn around to get you solvent for the time being.
Do you have a local pawn shop? When you pawn things, it’s not like selling them. All you’re doing is trading your belongings for cash temporarily. When you get that cash back, you come to buy your item back. There are a lot of advantages to this method of getting cash quickly. It might not be the most money that you can get for something, but it is immediate.
Small Business Loans
If you know hard times are coming, then you can get small business loans in advance of trouble. For example, if you know that a slow part of your season is just around the corner, getting a loan before that downturn means that you will have the cash flow to make it over the hump. This is one of those cases where appropriate planning will make all of the difference. If you have a business plan set that is flexible with supply and demand, that makes your job as an owner or manager that much easier.
Friends and Family
It depends very much on your situation if you want to get a loan from friends or family. The best part about this is that there probably won’t be any interest involved, and the payback date is typically reasonably flexible. The trouble with getting money from friends and family is if you don’t pay it back at a timeline they’re comfortable with, then you can have some significant psychological tension between you and people that you care about. It will depend on your personality if you want to create an official contract or not.
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