Using a Merchant Cash Advance in a Pinch

Posted by Karen Erdelac on Jan 27, 2016

Using a Merchant Cash Advance in a PinchThere are times in the life of your business where you just need some quick cash to keep going. Your cash crunch could be caused by an unexpected slow period that puts you behind on rent and invoices. Maybe it's a piece of equipment that your business needs in order to function. Sometimes it happens when an essential employee suddenly quits and you need to hire expensive temporary help until you can replace the employee.

Merchant Cash Can Be Helpful

Using a Merchant Cash Advance in a PinchA merchant cash advance can help you out in a pinch, but it's important to have a plan that will move your business forward and avoid a downward spiral that can be detrimental. Merchant cash advances are great for growing businesses that need support and funding. If your business isn't growing, you may want to work on that as you repay the advance.

Merchant cash advances are a purchase of the future sales of your business. The reason you need to be careful how you use them is that they come with fees. In order to repay the amount purchased and the fee without falling further behind, your business has to grow. By the time you pay the advance and the fee back, you will have less cash on hand than you did before getting the advance. This can put a crimp in your business if it isn't growing.

Avoiding a Perpetual Pinch

Merchant cash advance providers want you to be aware of what is involved in getting an advance so that you don't find your business in a perpetual pinch where cash flow is continually decreasing. Merchant cash advances can actually help your business grow if they are used in the most advantageous way.

Along with getting out of your original pinch, it's wise to use some of the cash advancement to grow or expand your business. You should definitely get caught up on your bills, but you may also want to expand your inventory so that you can increase your sales. You should definitely buy that necessary equipment, but you can also increase your restaurant's hours so that your revenue increases.

When you use your advance to help your business grow, you put yourself in a better position so that once the advance is repaid, your cash flow actually increases. Without the upfront cash infusion, it may not be possible for the business to grow, but with the help of a cash advance, you can meet your business growth goals more quickly and benefit from the growth for a longer period of time.

The uses of a merchant cash advance are too numerous to list them all here. The bottom line is that if they are used correctly, they can lead to increased prosperity for your business and more growth going forward. Quikstone Capital Solutions provides responsible merchant cash advances to businesses for their benefit in the long run.

Looking for a way to grow your business, fund your business or just get by in a pinch? We have 10 ways - download our Top 10 Reasons Businesses Choose Alternative Funding.

Top 10  Reasons Businesses Choose Alternative Funding

Topics: Funding Your Business, Grow Your Business, Merchant Cash Advance