JUNE 2017: Part 2: Common Financing Issues Faced By SMEs
In this series, we look at the SME surveys conducted by the DP Information Group in 2015/2016. We hope that owners and operators of SMEs will find the discussion useful for understanding more about small business financing matters. The complete report can be found at their website but we will select an interesting topic for discussion to keep the reading light and easy.
Previously, we mentioned that the top three cost challenges faced by SMEs were Manpower, Materials and Rental. The fourth most challenging cost item was the cost of financing in 2016 and more SMEs were concerned about it than the other cost items.
So what were the key components of the cost challenge of financing? There were in descending order:
- Higher Interest Rates for Bank Loans
- Suppliers Tightening Credit Access
- Need More Collateral for Same Financing
- Delayed Payment from Customers
- Unable to Renew Financing
In our previous article, if your business is facing higher interest costs for your bank loans, we are happy to look into your case and see if there can be a way to provide a better value proposition for your financing needs. Yet, there may be other times when you are affected by the actions of other parties like suppliers who are tightening their credit terms, or your customers who are dragging their payments when due. These actions can have negative knock-on effects on your cashflow management, but you may not want to go too pushy or hard on these parties for the sake of future business relationships. So what can you do?
Here is where you may let us offer you the option of invoice financing or factoring as a potentially untapped, and alternative form of financing for your business. Besides unlocking the funds due from your invoices or receivables more quickly to meet business expenses or pay the suppliers, you also receive the benefits of debtor and collections management on your behalf by IFS Capital. This saves you time and energy for your business and sales, where it really counts.
At IFS Capital Limited, we are happy to consider alternatives for you. Why not drop us a note at https://www.ifscapital.com.sg/request-a-call-back/ and we can discuss this in further detail with you.
If you like to read further on invoice financing / factoring, please click here.
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