Why Wait? Expand Your Business Reach With a Merchant Cash Advance

Posted by Karen Erdelac on Feb 17, 2016

Why Wait? Expand Your Business Reach With a Merchant Cash AdvanceThere are two main ways to expand a small business as far as finances go. The first is to invest money up front for office and/or retail space, staff, marketing, and inventory. The second is to bootstrap it - to invest minimally, then use the money form sales to keep things going and build.

The advantages of the first method are that you can get up and running much faster and you avoid the problem of being limited by your current sales, which can make your growth much slower. The advantage of bootstrapping is that you have no debt. But debt is not necessarily the worst thing in the world if it helps you move forward and meet your business goals more quickly. Many of the largest businesses that exist today were funded by investment at the beginning, which enabled them to build a structure that made them very successful later on.

The problem with bootstrapping and building slowly is that you end up not being able to afford all the important things your business needs at the most advantageous time. Because the cash flow isn't there, you end up forfeiting opportunities that could help to expand your business. Or the business doesn't grow as much as it could because you couldn't afford to market it the way you needed to. 

The Importance of Timing

Why Wait? Expand Your Business Reach With a Merchant Cash AdvanceMany goods and services are seasonal or follow other time lines that influence sales. You don't usually buy soccer cleats when it's not soccer season, and you don't Christmas shop in March. If your cash flow doesn't allow you to purchase advertising at the right times, it won't help your sales.

Timing is important in expanding the business as well. Sometimes you need fast funding, say an opportunity arose to buy out a competitor or move to a bigger location at a great price, but it is usually a limited time offer. If you don't have the cash flow to seize that opportunity right away, it could pass to someone else.

Merchant Cash Advances Help Businesses Expand

Merchant cash advances are lump sums of cash that represent a purchase of your future sales. If you have good sales but it would take you a year to save up enough money to buy out your competitor, a MCA may be able to give you the cash up front. Then you pay back a small percentage each day from your sales. After the advance is repaid, your expanded business will yield greater profits.

There are no restrictions on how you can use a merchant cash advance, and no collateral is needed. Quikstone Capital Solutions looks at the whole picture of a business owner's credit and business situation and can be approved sometimes in as little as 48 hours.

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Topics: cash flow, merchant cash advance, fast funding