You just got a line of credit for your small business — great news! You now have an important tool to ensure your daily operations run smoothly.
A credit line gives you the ability to respond quickly to daily or unexpected business needs. You can use it to fix a busted piece of equipment, fill a bigger-than-expected order from a customer or even reward your employees for their hard work.
It offers you the flexible financing needed to help you stay focused and even afloat when unforeseen events hit.
But you must know how to make the most of a credit line. Here are some tips:
Invoice factoring, also known as accounts receivable financing, has been around for centuries. It’s a financing option that has made it possible for generations of business owners to tap capital trapped in their unpaid invoices.
Instead of waiting for days or weeks for customers to pay their bills, factoring lets business owners get an advance on those invoices and use the cash for pressing business needs.
Business owners have been factoring since the Babylonian Age. For small and medium-sized businesses it has long been an effective way to fund their day-to-day needs.
Getting a business line of credit can help you deal with current and future challenges in running your small business.
But the process of getting one can be tricky. It’s important to have a clear idea how to apply for a line of credit for your business and how to avoid blunders that could hurt your bid for financing.
Here are 5 key mistakes that could delay or even derail your application: