Short Term Loan No Time to Waste
Author: Casey Marie Long
Date posted: 01.01.20

While snagging large corporate clients is great, you often have to wait for your payments to make their way through their accounts payable department. That can mean a lot of headaches and cash flow issues for small businesses that are growing quickly. Unlike small business clients that are often willing to pay you for your services on the spot, corporations have a lot of red tape involved in their payment processes.

That’s exactly the predicament that a small business in Northern California found themselves in during late 2020.  Their business was a bit of a niche – they collected medical waste from large nursing home complexes and then handled the safe disposal of the hazardous waste.  The nursing home companies appreciated the service because there were heavy fines for improperly disposing of the waste.  They wanted to branch out into servicing hospitals who had far greater waste disposal needs, but all required more resources than the company had.

 

The problem was that the company incurred expenses for payroll and disposal fees 30-60 days before they received payment from their clients.  They had to be quick with their invoicing or else the payment would take even longer.

Though their long-term prospects were good, they were constantly running into cashflow issues.  Without any large equipment to leverage, they needed to obtain a short term loan to help them get their cash flow under control.  With several large clients paying them regularly, they were able to meet the revenue requirements. There was only some basic paperwork required to apply for the loan which worked well for the owner who was very busy filling in different roles for the company; including scheduling, management, and accounting. They qualified for a $250,000 loan with a 2 year term length.

 

Once she was approved, the business received the loans in 24 hours.  The cash cushion decreased the stress level of the owner significantly and stopped her from having to carefully consider the timing of payment.   Within days, she was able to invest in additional manpower and set her sights on servicing her first hospital.

About The Author | Casey Marie Long

Casey has 12 years of technical writing experience. She is also a CPA and bookkeeper. Casey graduated from the University of St. Thomas (Minnesota) with a B.A. in mathematics and currently resides in San Diego, CA.

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