How Can Asset Based Lending Help My Company?

Throughout the course of a business’s life, the owner or manager will need to seek out additional funding. This is very important in the first few years of a business’s life, however it will be required at various times throughout the entire course of doing business. As your business grows and adapts, it will need to explore different types of financing. One type of financing that is separate from traditional forms of financing is known as asset based lending. This type of financing can help businesses of all sizes by leveraging their on hand inventory, stationary assets and accounts receivable in order to receive financing.

The Many Ways it Can Help

Asset based lending can dramatically help businesses of all sizes. There are many situations when asset based lending is ideal for your business. Below are common examples that will greatly benefit your business. You can view this website to find even more ways asset lending can assist your business.

  • When a business’s growth outpaces its incoming cash flow. Asset based lending can leverage the accounts receivable to receive required funds.
  • Sometimes orders are received that require more materials or capital than a business has on hand. Using purchase order financing, a company can secure an additional line of credit that will help them cover the large order.

How to Find Financing

There are several different companies that offer asset based lending. Each different company will have their own different services, requirements and processes. As you begin to evaluate asset based lenders, consider the below elements of the lender’s business:

  • How long has the company been in operation? Do they have a proven track record of being able to provide funding when required?
  • What is the time frame that you will have to wait to receive funding? An ideal asset based lender will be able to provide funding within a short amount of time to ensure that your business is able to continue to operate.
  • Once you have found a lender that looks promising, contact their customer support and see how long you have to wait to speak to a person. Are they courteous and friendly?

Your Business Can Secure Financing

During the course of operational life your business will surely need to secure funding. If the traditional avenues of bank financing fail, you will likely be able to receive the funds you require with asset based lending. By leveraging your businesses assets, whether it’s your accounts receivable or on hand inventory, your business can secure financing.