
Some Businesses Have an Ebb and Flow
One of the things that wasn’t perfect for the business was cash flow. Some months there would be a ton of work and money would easily come in. Other times, there might be little work and it would be harder to ensure bills were paid, employees get checks, and marketing could go out.
Based on this issue, the owner decided it could be a good move to seek out financing. When business was dropping, they’d have a safety net for all the business necessities. Then when things picked back up, the extra profits could go to the months when things were slow.
How Much Money Is Right?
Rather than needing millions of dollars for a new building, the main need here was to have some influx when things were slow. The fluctuations in cash flow could be stressful even if the company was overall profitable. Looking into the records was the best first step to determining how much money would be right for the company’s needs.
After digging into the specifics, the owner decided that a $100,000 loan would be more than enough to keep things running smoothly regardless of how a specific month went. So all that was left was deciding on the right form of financing to meet the company’s needs.
