Commercial finance, is a fantastic way of finding financial aid or solutions which are specifically designed for your business. Specific deals, could mean better rates, with features aimed at making the running of your business easier. Read our latest guide and what options there are.
What it is?
First off, you may be thinking ‘I run a business and I’m looking to grow’. You want to invest in your business but you may be wondering what actually is commercial finance?. It’s quite simple, it’s a collective term used to summarise investment and financial offerings available exclusively to businesses. It’s not private or personal investment, which is very different.
Who can access commercial finance?
A commercial finance broker, is a good place to start. The reason is, that they have the whole of the market available to them. This allows you to compare business finance options.
In addition, you have the whole of the market available to you. You can then, select the financier who is right for you and have the benefit of the finance broker knowledge. This is key to get the most suitable finance solution for your business.
What commercial finance options are there?
Invoice finance, business loans, asset finance and merchant cash advance are examples of commercial finance. All of these finance solutions bring their unique funding angle to a business. If you are involved in the healthcare sector, recruitment, or haulage industry, customers are slow at paying. So how do you mitigate this and boost cash flow?.
Invoice finance, is a solution that assists with cash flow and allows you to grow. It can be a selective invoice facility or whole turnover depending on how your business operates. Furthermore, if you take a lot of card payments such as shops, pubs, hospitality, and hotels then merchant cash advance can be a way of borrowing funds against your card terminal. Let’s say you take £20,000. The financier will repay the loan as a percentage of the card transactions. It’s a very quick and easy finance solution to get set up with a clear fee structure.
What are the pros and cons of commercial finance?
This is a question that gets raised a lot by business owners and rightfully so. This is because, how do you know that the investment is right for you? Having a business plan and structure of where you want to be in 12-24 months time, allows you to plan, which is the first step. If you have this, then get in touch with a finance broker and do your research.
The commercial finance broker will look at past and future projections and discuss what you are looking to achieve with the business funding. Have information to hand such as bank statements, business plans, annual accounts if applicable, and a clear vision of how you are going to use the finance to achieve your business goal. This will allow the finance broker to assess your business and compare the funding solutions available.
Once you have funding options ask questions about how the facility will work and decide if this is suitable for you. You know your business better than anyone else, so you need to decide on the most appropriate funding solution.
Where can I get this kind of loans?
One of the most common forms of commercial finance is a business loan. This is because most people think of a commercial loan when they envision investing in their business.
With the rise of alternative business funding in the marketplace since 2008, there is a wide array of un-secured and secured loan providers therefore, they bring different propositions about to with concerning rates, funding terms, and flexibility. The good news is, if you are a non-homeowner that needs a loan then still there are many lenders for you.
A commercial finance broker will source a business loan. Here at Pinnacle as a broker in Bristol, business loans are a specialist field for us. We have funding specialists that will explain clearly and thoroughly how the business loan will operate and the pros and cons of each offer. Hopefully, after reading this, you could start to feel more confident in what commercial finance is and how you can access it.
Get in touch with Pinnacle Business Finance Today
We hope that our guide to commercial finance and the options available to you has helped to introduce you to the subject. If you would like more information on commercial finance, please get in touch with the Pinnacle Business Finance team today.
