Business Growth and the Impact of Loans

By December 12, 2019 Factoring
business growth

Whether you are rolling out new services, trying to tap into markets in new locations, or expanding your facilities, business growth doesn’t happen overnight. While loans are typically used to overcome hurdles and reach the next big milestone, businesses are realizing that taking on debt can prevent them from reaching their full potential. To achieve rapid business growth, owners are considering a more viable solution.

Debt and Business Growth

If you are positioning your business for growth, there is a built-in cost for expansion. Additionally, there is a risk involved to recoup the capital used for growth. Taking out a loan to achieve business growth only adds to the expense, because a portion of the revenue must be set aside for loan payments plus interest. For these reasons, businesses often scale back their growth targets, which can result in some projects being delayed or getting put on the back burner. Debt inhibits growth potential for businesses and can prevent otherwise huge successes.

Finding Alternatives for Business Growth

Achieving business growth without taking on debt may seem like an impossibility. However, more businesses are building up capital and reducing debt to grow their operations with as few financial liabilities as possible. In an economic climate where interest rates on traditional business loans have been unpredictable, finding a debt-free alternative is preferred. One method that offers positive results is invoice factoring. Invoice factoring takes unpaid receivables and converts them to cash, allowing business owners to build up capital for growth without taking on debt, instead of waiting on payments from clients. The added benefit of invoice factoring, apart from fast access to revenue, is that no debt is placed on the books, so business owners can preserve and build up their credit ratings. Invoice factoring is used by businesses across all industries, from tech startups to law firms, medical practices, manufacturers, freight carriers, and any other organization that issues invoices with payment schedules of a month or longer.

Single Point Capital provides invoice factoring solutions to help businesses correct cash flow issues and achieve growth. To learn more about our services, contact our offices today.

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