Do you have an idea or a concept that will help your business grow, but you need funding to bring it to life?
A business loan offers a degree of flexibility as you can take our a fixed or variable rate, and you keep control of your business.
They’re also an ideal solution if you’re looking for a cash injection.
Benefits of a business loan
Fuel your growth
The money you have coming into your business from day to day activity may be sufficient to keep things running smoothly, but may not be enough to fund new ventures or your scale up plans.
There is often a gap between paying for your growth activity and reaping the rewards, which is where a business loan can step in. For example, you could run a marketing campaign to attract more business, increase your stock for a bigger Christmas season, or add a new vehicle to increase your capacity.
They’ll all pay for themselves and more over time, but you need the cash up front to fuel that growth. So if your day to day revenue won’t be enough, a business loan can help you make that leap.
Cash flow buffer
The old saying is that “Cash is King”, and having a cash flow buffer means you can react at speed to take opportunities without impacting on the day to day operations of your business. A business loan can provide that extra capital for you, so if a new product suddenly becomes available, for example, you can react quickly and make it available to your customers. The same applies if an unexpected expense arises, such as higher bills or repairs to plant or machinery.
Keep all your equity and stay in control
One alternative to taking out a business loan is seeking investment. The advantage of a business loan over an investment, however, is that you get to keep full ownership and a lender won’t seek to have any influence on how you run your business. Investors, on the other hand, often demand a stake in the business in return for the money they put into it, and will often expect to have some kind of say in business decisions.
Attractive terms
Many lenders offer better interest rates on business loans than they do on other products, reflecting the competitive nature of the business loan marketplace. Business loans are also often offered on an unsecured basis, meaning that as long as your business meets the eligibility criteria of the lender you won’t be asked to put any collateral forward. This helps you keep control of all your assets, and helps to access finance if you don’t have assets to put down as collateral.