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How To Compare Commercial Finance

Commercial finance can be a fantastic way of finding financial aid or solutions which are specifically designed for your business. Specific commercial finance deals could mean better rates, with features aimed at making the running of your business easier. Read our latest guide on commercial finance and what options there are.

What is commercial finance?

First off you may be thinking ‘I run a business and I’m looking to grow’. You will want to invest in your business but may be left wondering what actually is commercial finance? It’s quite simple and the answer is 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 when looking to access commercial finance. The reason being is that they have the whole of the market available to them and 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 getting the most suitable finance solution for your business.

What commercial finance options are there?

Examples of commercial finance are invoice finance, business loans, asset finance and merchant cash advance. All of these finance solutions bring their own unique funding angle to a business. If you are involved in the healthcare sector, recruitment, or haulage industry then notoriously customers are slow at paying for the service or goods you have provided. So how do you mitigate this and boost cash flow? Invoice finance is a solution that assists with cash flow and allow 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 then the financier will repay back 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 ahead, 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 plan, 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 make the decision on the most appropriate funding solution.

Where can I get a commercial loan?

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. They each again bring a different proposition in relation to 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 which will explain clearly and thoroughly how the business loan will operate and the pros and cons of each offer. Hopefully, after reading this you 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.

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