Month: November 2024

Do you want to know how to grow your small business with marketing? Growing a small business takes a blend of strategic planning, innovation, and financial management. One often overlooked tool that can fuel small business marketing efforts is working capital.

For small to medium-sized businesses, finding effective ways to market with limited resources is crucial for success. According to reports, 47% of small businesses struggle with implementing the right marketing tactics. As such, there is a great need to utilize working capital effectively so that all marketing expenses drive real growth.

This article will cover actionable marketing tips for small business owners to maximize their working capital and expand their reach.

The Relationship Between Working Capital and Marketing

Effective small business marketing strategies often require funding to boost visibility and attract new customers. Working capital can support both short-term and long-term marketing efforts. It allows small business owners to fund everything from social media ads to targeted email campaigns.

When implemented strategically, these promotional tactics can attract new customers while also retaining existing ones, creating a cycle of growth.

Working capital enables small businesses to maintain a consistent marketing strategy without disrupting daily operations. It guarantees that there are enough resources set aside to continually market the business and at the same time meet basic survival expenses.

When small business owners are able to control their cash flow, they invest in marketing knowing their operations are not going to be in any danger. This balance also enables organizations to remain active and competitive in the market without over-exerting their resources.

Plus, it ensures that each marketing effort aligns with broader business goals: maintaining visibility, attracting customers, and supporting long-term growth.

Even if you’re investing in social media marketing or optimizing your website for local search, a clear small business marketing strategy that considers working capital can help you maximize returns.

Leveraging Your Working Capital Sources

To support a solid marketing strategy, small business owners can use different sources of working capital, such as loans, lines of credit, or cash reserves. Each source can support distinct marketing tactics, helping businesses reach their target audience effectively.

For instance, a line of credit can fund short-term campaigns, such as social media ads or Google Ads. On the other hand, reinvested profits might fund content marketing or SEO for sustained visibility over time.

Small businesses can take advantage of these sources to implement a diversified marketing strategy that includes digital marketing, social media, and even traditional marketing channels.

By maintaining a steady cash flow and selecting the right funding sources, small businesses can create flexible marketing strategies that adapt to market changes. It allows businesses to seize short-term opportunities while building long-term brand recognition.

Combining these different resources helps businesses stay competitive and engage their audience across multiple channels.

Aligning Marketing Goals with Available Capital

Aligning marketing goals with available working capital ensures an effective strategy by helping businesses prioritize their spending. It allows them to allocate funds to the most impactful marketing efforts, ensuring they don’t overextend financially.

Small businesses should start by setting specific goals, such as raising brand awareness, attracting new customers, or building loyalty with existing customers.

With clear objectives, it becomes easier to choose marketing plans that fit within the budget while still achieving desired outcomes. For instance, if a business’s primary goal is to attract new customers, investing in a social media strategy might yield the best results.

According to a recent study, 73% of marketers believe that social media marketing has been effective for their business to some degree. Why? Because social media can reach a wide audience at a relatively low cost, providing maximum exposure with minimal expenditure.

Alternatively, a small business aiming to build loyalty might benefit from an email marketing strategy that keeps existing customers engaged with regular updates and special offers. Aligning goals with available capital ensures that every marketing effort contributes directly to business growth.

Working Capital and Short-Term vs. Long-Term Marketing Strategies

Short-term strategies, like limited-time offers or social media ads, can generate immediate engagement and bring in new customers.

Having immediate access to working capital lets businesses quickly adjust their marketing strategies to meet market demands, allowing them to take advantage of opportunities while keeping finances in check.

On the other hand, long-term strategies such as content marketing or local SEO help build a solid brand presence and attract consistent customers over time. These approaches create lasting connections with audiences, driving repeat business and fostering brand loyalty.

It’s also important to check how both short and long-term strategies are performing regularly. It enables businesses to optimize their marketing efforts, ensuring they maximize their budget and achieve the best possible return on investment.

Creative Marketing Strategies on a Restricted Budget

When working capital is limited, a creative marketing campaign becomes essential for small businesses. Here are some cost-effective marketing tips for small businesses owners to maximize reach without overspending:

Content Marketing

Creating high-quality, relevant content is an affordable small business marketing strategy that can build trust with your target audience. A strong content marketing plan can improve your search engine rankings and drive organic traffic to your site.

Over time, this positions your business as an industry expert and builds lasting relationships with your customers. By offering valuable insights, you engage your audience and keep them coming back for more.

Whether it’s through blog posts, videos, or social media updates, content marketing enhances your online presence and brand loyalty.

Search Engine Optimization (SEO)

Search engine optimization (SEO) is a long-term marketing tactic that helps bring consistent traffic to your website. Unlike paid ads, SEO doesn’t require constant funding and can generate organic traffic over time.

Local SEO is especially useful for small businesses, as it helps you get noticed by potential customers in your area. Optimizing your site for search engines increases visibility and improves your chances of ranking high on Google.

Key tip: Customer reviews play a key role in local SEO. Positive reviews on platforms like Yelp or Trustpilot help improve your local search rankings and build your reputation in the community

Business Partnerships

Partnering with other local businesses is a great way to expand your reach. You can cross-promote your products or services and share customer bases, which can lead to new sales opportunities.

Working with other businesses allows you to tap into each other’s promotional efforts and leverage their networks for mutual growth.

Additionally, joint events or shared marketing initiatives can create buzz and build goodwill within the community. This increases brand awareness, saves on costs, and strengthens local connections.

Traditional Marketing

Traditional marketing methods like print advertising and direct mail can still be valuable, especially for small businesses with local customers.

Flyers, posters, and postcards are simple, low-cost tools to increase brand visibility in your community. These methods can work alongside your digital efforts, reaching customers who may not be online as frequently.

Combining traditional and digital outreach broadens your audience, while the personal touch of print marketing can help make your brand more memorable.

Mobile Marketing

Unlike social media marketing, which focuses on platforms like Instagram, mobile marketing engages users directly on their mobile devices, regardless of the app.

In a time where almost everyone is on their devices, mobile marketing is crucial for reaching on-the-go consumers who are constantly connected. With smartphones being an integral part of daily life, businesses have a unique opportunity.

They can engage potential customers through targeted ads, push notifications, and location-based promotions to deliver relevant content and offers. But, what does this do exactly? It drives immediate action and brand loyalty – something every small business owner wants to hear.

To maximize this, ensure your website is mobile-friendly and integrate mobile strategies with social media and SMS for a seamless, accessible brand experience.

Referral Programs

Referral programs are an easy way to grow your customer base. It encourages existing customers to spread the word. By offering rewards like discounts or small gifts, you incentivize referrals that bring in new customers.

This type of marketing is low-cost and highly effective, as it relies on word-of-mouth from satisfied customers who vouch for your brand.

Plus, referrals help foster trust, as recommendations from friends or family often carry more weight than traditional advertising. A well-structured referral program can boost loyalty and create lasting relationships with new customers.

Social Media Marketing

Social media advertising is a powerful way to engage with your audience and build brand awareness. Platforms like Facebook, Instagram, and Twitter allow you to reach a large number of people without spending a lot of money.

By combining organic posts with targeted ads, you can drive traffic to your business and attract new followers. Consistent engagement with your followers keeps them informed of updates, promotions, and new products.

Additionally, social media channels provide valuable customer feedback. This allows you to adjust your efforts based on audience preferences.

Email Marketing

Email marketing is a direct way to reach your customers with personalized offers and updates. It’s an effective strategy for staying in touch with your existing customers and encouraging repeat business.

Segmenting your email list enables you to send targeted messages to specific customer groups, improving open and click-through rates. Regularly sending relevant content strengthens relationships with your audience, creating brand loyalty over time.

These email strategies allow you to maintain a personalized connection with customers, encouraging engagement and long-term customer retention.

Guerrilla Marketing

Guerrilla marketing is all about being creative and standing out with low-cost tactics. Flash sales, street art, or unconventional promotions can grab attention and spark curiosity.

These unique approaches help your business get noticed in a crowded market. Plus, it can create a buzz around your brand and encourage word-of-mouth referrals.

With limited budgets, small businesses can benefit from these eye-catching techniques that engage the community and attract new customers without heavy advertising costs.

Directing Cash Flow for Marketing Campaigns

To ensure that marketing campaigns are both effective and sustainable, businesses must manage cash flow carefully. Monitoring cash flow allows you to direct funds toward the promotional tactics yielding the best results.

Analytics tools such as Google Analytics and social media insights provide data on engagement, helping you optimize your marketing strategy based on performance.

By allocating more funds to high-performing channels and scaling back on less effective strategies, small business owners can keep campaigns aligned with their cash flow.

Effective cash flow management allows businesses to allocate resources where they are most needed, whether it’s redirecting funds to a high-performing social media campaign or boosting local SEO efforts.

By tracking cash flow closely, small businesses can quickly adjust their marketing budget to scale successful initiatives and pivot away from less effective ones. It ensures that marketing strategies remain agile and responsive to changing market conditions.

By adapting marketing budgets to focus on the most effective strategies, companies can respond to shifting market dynamics. Ultimately, the goal is to maximize every dollar spent, ensuring that the marketing budget is used as efficiently and impactfully as possible.

Maintaining Growth with Smart Capital Management

Smart capital management goes beyond just reviewing budgets – it’s about ensuring that marketing initiatives are aligned with a business’s growth objectives.

For small businesses, the focus should be on directing funds toward strategies that generate measurable results. This includes expanding brand presence or increasing customer retention.

By strategically prioritizing marketing goals, businesses can select the most effective approaches based on available capital.

For instance, when aiming to attract new customers, investing in social media campaigns might yield a higher return on investment. Meanwhile, email marketing could be more effective for nurturing existing relationships and enhancing loyalty.

Conclusion

Small business marketing does not have to feel daunting. By using working capital wisely, you can boost your brand’s visibility and growth.

Remember: Combine short-term and long-term small business marketing strategies like social media management and SEO. They can help drive sales, attract new customers, and increase exposure. With effective capital management and a focus on improvement, your business can lay a solid foundation.

Ready to grow your business? Partnering with experts like E-Boost ensures you make the most of your marketing budget. Reach out today for personalized insights and smarter marketing strategies that deliver lasting results!

Are you ready to build your dream home project but need help to finance it? Knowing the current construction loan rates is essential for small-to-medium-sized business owners looking to begin construction.

With construction loans specifically created for funding the building or renovation of a property, understanding their rates can mean the difference between a successful project and financial strain.

Let’s dive into what you need to know about construction loans and how to secure the best rates.

What Is a Construction Loan?

A construction loan is an efficient financing option to fund new builds or major home renovations.

Unlike a traditional mortgage loan, which is used to purchase a finished property, a construction loan provides the necessary funds during the construction process. This type of loan covers the costs of labor, materials, permits, and other expenses associated with the project.

Construction loans have a set term, generally between six months to one year, and are intended to be paid off or converted into a permanent mortgage once the project is complete.

A key feature of a construction loan is the draw schedule. It outlines when funds will be disbursed to the borrower. This structure allows borrowers to pay interest only on the funds they have drawn, making it easier to manage monthly payments during the project.

Construction Loan Rates

Current construction loan rates can fluctuate based on market conditions, the borrower’s financial history, and the project specifics.

As of 2024, studies show that the average construction loan interest rate is between 9.75 and 11.5%. However, rates can vary depending on the lender, loan terms, and whether you’re securing short-term construction financing or a construction-to-permanent loan.

To secure the best construction loan, start by comparing rates across lenders. Rates can differ widely, so you want to evaluate multiple options to ensure that you are getting a competitive deal in order to match your project needs.

Many lenders offer flexible construction loan options, allowing borrowers to choose between fixed-rate or adjustable-rate loans, depending on their financial needs and preferences.

Plus, some lenders may offer jumbo loans for larger projects, which often come with competitive interest rates.

The loan-to-value (LTV) ratio is the jackpot in determining your loan rates. A strong understanding of LTV helps you anticipate the rates lenders may offer, impacting the overall cost of your construction loan.

Generally, lenders prefer a lower LTV ratio, which indicates less risk on their part. In competitive housing markets, it’s advisable to secure pre-approval to enhance your credibility when negotiating loan terms.

Origination Fee

When applying for a construction loan, you might come across an origination fee. This is a charge from the lender for processing your loan application, typically ranging from 0.5% to 1% of the total loan amount.

It’s a good idea to factor this fee into your overall project costs, as it adds to your closing costs.

The origination fee is just one part of the picture. Lenders may also charge other fees, like application fees or costs related to underwriting and processing your loan.

Being aware of these fees can help you plan your budget more accurately. Not to mention, it can also help avoid any surprises as your construction project progresses.

Extra Closing Costs

Closing costs for a construction loan are fees required to complete the loan process. These costs can include appraisal fees, title insurance, and inspection fees — all of which can add up quickly. Asking for a breakdown of the estimated final closing costs from your lender will ensure no surprises arise.

Closing costs can total 2-5% of the loan amount and an origination fee, often around 1% of the loan. Closing costs, which are fees paid when finalizing a mortgage, typically amount to 2-5% of the total loan. Among these costs is the origination fee, usually around 1% of the loan amount. It compensates the lender for processing the loan application.

By knowing these costs in advance, you can plan your budget more effectively and have a clearer idea of what your monthly payments will be. Be sure to account for any taxes and insurance that may also factor into your overall financial commitment during the construction period.

Realtor Fee

If you’re working with a real estate agent to find the perfect property for your construction project, be aware of the realtor fees. These fees are generally around 5% to 6% of the property’s purchase price. Typically, the seller pays this fee. However, it can also be negotiated between the buyer and the seller’s agent.

The realtor fee is another key factor in your overall budgeting for the project. By including this fee in your financial calculations, you can ensure that you’re prepared for all aspects of the construction process, from breaking ground to the final inspection.

How to Apply for a Construction Loan

Applying for a construction loan requires careful planning. Here’s a step-by-step guide to navigating the financing process effectively:

1. Plan the Project

Before applying for a construction loan, outline your project in detail. Determine the scope of work, estimated construction costs, and a timeline for completion.

Having a clear project plan will help lenders assess the viability of your loan application. You’ll want to consider potential cost overruns and how to manage them to avoid delays. It’s also helpful to have a contingency plan for any unexpected changes

2. Select a Lender

The building process is expensive, and each dollar that you spend will influence how well your project turns out. Comparing construction loan lenders should begin with the lenders themselves and their terms.

Construction loans are available through a variety of lenders, who assess risk and set interest rates differently.

Go for lenders that have experience in construction financing as they are more likely to offer tailored loan options for a custom home or a significant refurbishment. Also, take note of the charges for origination, closing, and inspections for those costs can add up rapidly.

See customer reviews on sites like the Better Business Bureau (BBB) or other reputable financial sites such as NerdWallet to find out whether or not the lender is reliable, trustworthy, and provides good quality service.

3. Gather Required Documentation

Lenders will require various documents to process your loan application. Be prepared to provide financial statements, tax returns, a detailed project plan, and any necessary permits.

Having these documents ready can expedite the approval process and improve your chances of securing favorable loan terms.

4. Confirm Loan Terms

Before finalizing your construction loan, carefully review the terms and conditions. Ensure you understand the interest rate, repayment schedule, and any additional fees.

It’s crucial to confirm how your monthly payments will be structured during the construction phase and what your actual payment obligation will be once the construction is complete. Don’t hesitate to ask your lender for clarification on anything you find confusing.

Conclusion

Understanding current construction loan rates is a necessity for business owners beginning a construction project. Knowing the loan process, associated fees, and strategies for securing favorable rates will help you budget effectively and manage costs.

Know everything you can in advance: research, collect the necessary documents, and try to estimate your timeline. When you have a well-defined plan and the financial institution that will help you implement it, nothing can stop you in turning your construction project into reality.

For expert guidance and flexible financing options, reach out to E-Boost Partners today. Our team will help you navigate the construction loan process and secure the best terms to bring your vision to life.

Are you considering building a small manufacturing business? It’s a good time for you to start. In the United States, as elsewhere, the number of small businesses is soaring. The entrepreneurial spirit is high, and that’s good news for the economy and employment.

Ultimately, every new business starts with a simple idea. That’s why we’ve assembled the top small business manufacturing ideas for you to consider.

These manufacturing business examples may resonate with you or inspire you to broaden your business horizons. Either way, you’ll feel empowered to blaze your own trail in the exciting manufacturing industry.

Small Manufacturing Business Examples

Getting a foot in the door of the manufacturing industry can be challenging. The easiest manufacturing business to start is one that produces products that are in high demand.

These manufacturing business examples will give you an idea of the possibilities. It’s up to you to decide which fits your vision and meets your future community’s needs.

1. Candle Making

The first of our small manufacturing business examples is candle making. This can be the best manufacturing business to start, as you don’t need too many resources and you can easily start from home.

Aromatherapy candles are especially popular, thanks to society’s renewed interest in natural therapies that reduce stress and boost wellbeing. But before you quit your job, you’ll need the basics to start your candle-making business.

You’ll have to source wax, wicks, molds, dyes, and fragrances to start making your candles.

2. General Craft-Making

Next on our list of manufacturing business examples, is craft-making. This is one of those small manufacturing business ideas that is open to interpretation. There are various types of crafts, and the production process could differ significantly from one to the next.

General craft-making includes everything from leatherworking and wood carving to weaving. You could set up a workshop in a spare room of your home or your garage. Start by selling your crafts at local craft fairs to generate interest. As sales grow, you can transition to a bigger workshop off-premises.

3. Food and Beverage Production

Foods and beverages are always in demand. We all need to eat. But it’s also a highly competitive business market. Food and beverage manufacturing requires a steady supply of ingredients, a sterile environment, and efficient packaging and bottling equipment.

To gain entry into this bustling industry, consider starting with a simple product like bottled filtered water. You could market it to local supermarkets, health stores, or even gyms.

4. Textile Manufacturing

Textile manufacturing entails spinning, weaving, and knitting fibers into fabrics. These fabrics are then used by upholsterers and clothing manufacturers to produce soft furnishings and fashion garments.

Making a name for yourself in the textile manufacturing business takes time. Meanwhile, you’ll need to acquire raw materials like cotton, linen, silk, wool, or hemp. With the right know-how, equipment, and supply chain, you can make it a success.

5. Sporting Goods Manufacturing

The US population has a great love of sports. Therefore, a sports equipment manufacturing business may be a good business to start. But if manufacturing baseball bats, basketballs, and football helmets for the sports equipment industry doesn’t appeal to you, think smaller.

Sporting goods and gyms stock more than just the obvious gear. They also often sell branded sports apparel and gym accessories. Consider starting a small business that creates these custom products, or that brands ready-made sporting goods with company and team logos.

6. Furniture Maker

The most successful small manufacturing businesses cater to people’s practical needs. Furniture making fits the bill. Handmade furniture, like custom-made cabinetry, can be both functional and attractive.

You’ll need expert woodworking skills, some good woodworking tools, and a workshop. If you find this appealing, you may have just found the inspiration for your manufacturing business. And if your business’s success relies on delivery, we can assist with a business auto loan to help finance the delivery vehicle.

7. Papermaking

Thanks to a growing demand for eco-friendly products and sustainable practices, recycled paper products are a good business to consider.

Paper products are easily recyclable, and can be turned into things like gift bags and gift boxes, stationery supplies, and so much more.

8. Health and Beauty

The health and beauty industry is showing consistent growth. Therefore, making health and beauty products is one of the more promising manufacturing business examples.

Consumers are turning away from chemical-based toiletry and personal care products to gentler, more natural alternatives. So, if you produce natural health and beauty products made from organic and herbal ingredients, you’ll be almost guaranteed success.

9. Pharmaceutical Manufacturer

Pharmaceutical manufacturers can bring in a high revenue. But this is not an entry-level manufacturing business idea. You’ll need the qualifications and knowledge to go with it. FDA regulation also comes into play with any pharmaceutical manufacturing endeavor.

That aside, the pharmaceutical industry is a noble path to follow. Pharmaceuticals contribute to people’s quality of life worldwide.

10. Chemical Production

Chemical manufacturers supply raw chemicals to various sectors including food and beverage, pharmaceuticals, and cosmetics companies. Because of the wide range of potential customers, a chemicals manufacturing business can be a real moneymaker.

But this is a lot more complex than some of the other examples on our list. Chemicals require proper handling and shipping. Investigate the correct procedures to ensure compliance with health and safety regulations.

11. Automotive Parts Manufacturing

The automotive industry in the U.S. has had to deal with high interest, inflation, decreased consumer demand, and supply chain issues. Yet the automotive parts industry has continued to grow.

People who cannot afford to buy new vehicles still need spare parts to keep their older vehicles running and roadworthy. That’s why automotive parts manufacturing is still a good business to be in.

To remain competitive, you’ll need to scale your business to allow for mass production of parts. See our guide to scaling a business further down in this article.

12. Health and Safety

Health and safety products don’t just appeal to health-conscious consumers. They are a necessity in many industrial work environments. Tap into that need, and you could have a very profitable business.

Health and safety products include safety apparel like reinforced work boots, coveralls, and gloves. But there are many other products you could make, such as safety goggles, masks, and even workplace safety signs.

13. Toy Making

Toy manufacturing can be fun and financially rewarding. There are many different types of toys, made from various materials including plastics and textiles. Therefore, you have several options available to you, from knitted toys for infants to educational toys for toddlers, and action figures for slightly older kids.

14. Plastic Manufacturer

From packaging containers to homeware, toys, personal healthcare products, and more, we are surrounded by plastics every day.

Most plastics manufacturers produce these items through injection molding and then sell the completed products wholesale to various industries. This could be a very lucrative income stream if you can manufacture plastic products at scale.

15. Electronics Manufacturing

The electronics manufacturing industry produces components for everything from the computer industry to the aerospace industry. But before you reach for the stars, you could start small by manufacturing electronic components for small-scale manufacturers of electrical consumer products.

16. Pet Food and Supplies

Every household with a pet is in constant need of pet food such as tinned dog and cat food, dog and cat food in pellet form, or packed seed mixes for birds or hamsters. You’ll need a consistent supply of raw ingredients, as well as attractive packaging to stand out from the competition.

Pet supplies also sell well. These include wooden dog kennels, leather pet collars, textile or rubber chew toys, wicker cat baskets, scratching posts, and wire hamster cages. To start, you’ll need materials like wood, leather, rope, metal wire, rubber, and textiles.

17. Microbrewery

A microbrewery is an independent manufacturer of beer, and it can be a very profitable business. You can start by producing one or two types of craft beers for local bars and pubs and later expand to a broad range of products.

Take note that you will need a brewer’s license, liquor license, and wholesale manufacturing license. Your state may have unique regulations, so be sure to check before proceeding with your brewing business.

18. Cosmetics

The cosmetics and beauty industry is always going to be a winner.

Although the cosmetics industry is dominated by a few major players, you don’t have to compete with those big brands. You can become a successful cosmetics company by focusing on natural and organic lip glosses and hair products. Find what sets you apart from the rest.

19. Coffee Roasting

Coffee roasting is probably not what you expect to find on a list of manufacturing business examples. But it’s earned its spot because coffee is a top seller. You can market your deliciously roasted coffee products to local coffee shops and restaurants, or sell them to local retailers.

20. Baked-Goods

Baked goods is one of the simplest small manufacturing businesses to start. Although it’s technically a part of the food and beverage industry, focusing exclusively on baked goods is a good entry point into this sector. It’s relatively easy to set up a small baked goods business from home at little cost.

Sell your tasty bakes at local farmers’ markets, or negotiate a partnership with a coffee shop in your area. Who knows; in time, you could expand to become a large bakery chain.

21. Bespoke Shoe Manufacturing

Everyone needs shoes, and some of us buy new pairs frequently. But mass-produced shoes often leave a lot to be desired. Bespoke shoes, on the other hand, are custom-made. They offer more discerning customers excellent craftsmanship and the highest quality materials.

Although this is a niche market, bespoke shoes are popular in more affluent segments of the market.  This allows you to charge a premium price for your custom creations. You’ll need to take a shoemaking course and outsource fine-quality leather and textiles.

22. Soya Products Processing

Soya products manufacturers are some of the most profitable food processing businesses. As awareness of some of the benefits of non-animal protein sources grows, so too does the demand for products like soya chunks.

To start producing soya products, you’ll need to research how and where to get the base soy. You’ll also need food processing equipment and a sterile environment to work in. Get it right, and you can sell your products to health stores and at healthy living festivals.

23. Weaves, Wigs, and Hair Extensions

The growing market for weaves, wigs, and hair extensions has made this an exciting manufacturing business to be in. You may choose to work with human hair or synthetic fibers. Hair and beauty salons often stock such products, so they are ideal customers when starting this business.

24. Microfiber Towel Manufacturing

Microfiber cloth is known for its absorbency, softness, durability, and quick drying time. That’s why this synthetic material is in hot demand. These unique properties make it a popular choice for gym towels.

You’d need to find a source for the microfiber cloth. But with the right equipment, you could print and cut out small microfiber gym towels. Then all you’d have to do is sell them to sports supply stores and gyms.

25. Jewelry Manufacturing

Jewelry manufacturing is as old as time. Even the ancients were obsessed with adorning themselves with colorful beads and precious metals. You don’t have to be a goldsmith to produce jewelry. Costume jewelry can be made from a variety of materials, including base metals, acrylics, and plastics.

How to Start and Scale a Manufacturing Business

When you start your small manufacturing business, you will likely be focused on local or regional markets. In time, as the business grows, you may set your sights on a larger market share.

With hard work and determination, every small manufacturing business can thrive and grow. You just need to know how to build and scale your business.

Step 1: Choosing the Right Product

Starting a small manufacturing business in a niche market can be a good idea. You’ll have less competition to worry about than you would with more mainstream products. This also means you can be more optimistic in your pricing structure.

Do some market research to determine the local and regional interest in your niche product. Either local businesses must agree to stock your items, or you’ll have to sell your products directly to consumers.

Then there’s the matter of the raw materials needed. Will sourcing raw materials be easy and affordable? The more difficult it is to procure the required materials, the higher the risk of occasional delays. And the more expensive it is to get what you need, the more you’ll have to charge customers for the end products.

Step 2: Choosing the Right Location

You’ll have noticed that some of these manufacturing business examples are small-scale manufacturing business ideas. This makes them suitable for starting from home. And if you start a small manufacturing business from home, your location has already been decided for you.

This is not always feasible. Depending on the type of manufacturing business you want to build, you’ll need premises and facilities. It will become even more important as you build and scale your business. More demand for your products will mean expansion of your facilities.

Choose the right location for your business. Select an area zoned for the type of manufacture that you engage in. It should also be in or near an area where your target market lives. If you have a very broad customer base, most urban centers will be suitable. Niche markets require more careful location choices.

Step 3: Business Plan Development

Every profitable manufacturing business idea starts with a solid business plan. This is a documented strategy that outlines your business idea, mission, goals, and more importantly, how you intend to achieve them.

But it doesn’t stop there, because business development entails planning for future growth. This includes identifying new opportunities and scaling the business to take advantage of them. As your business grows, you will see the direction it is taking and gain insights into what your customers want.

Step 4: Acquiring Funding

Regardless of which of these manufacturing business examples piques your interest, you’ll need funding. This will cover everything from your initial equipment and the first batch of raw materials to everyday running costs.

Even if you manage to cross that hurdle with savings you have stowed away, it takes time to become a successful manufacturing business. At some point, you’ll need extra funding to keep afloat. A working capital loan can cover your operational expenses while you build and scale your business.

You can even use this funding for advertising and marketing campaigns. Online marketing helps businesses reach a wider audience in the increasingly digital age. You can save money while getting the word out about your products, by leveraging social media marketing opportunities.

Step 5: Securing Equipment

The manufacturing business examples listed above require vastly different equipment and tools. For smaller businesses that need more basic tools, you may be able to start with tools you already have. You could also purchase second-hand machinery for manufacturing your products.

The less you spend on the initial set-up, the better your chances for high profit margins. But you’ll need to invest in some new machinery and tools down the line as you build and scale your manufacturing company. This will enable you to leverage technological advancements and meet new industry standards.

Step 6: Hiring Skilled Labor

Many of these manufacturing business examples can be started as solo pursuits, but hiring skilled labor means you can produce high-quality products at scale. You’ll also be doing your bit for the economy, as small manufacturing businesses play a significant role in local job creation.

Step 7: Setting Up a Supply Chain

While all the manufacturing business examples we’ve provided involve different products, the rules for setting up a supply chain remain the same. In the manufacturing sector, the supply chain has multiple steps from sourcing raw materials and producing the goods to fulfilling orders and delivering them.

Review your business goals, particularly for revenue and production. Determine the necessary inventory levels to attain the desired output and the logistics for shipping and delivery. Get quotes from different logistics and courier companies and negotiate the best deal.

Step 8: Organizing Inventory Management

You’ll find it easier to organize your inventory schedule with inventory management software. You can find free basic inventory management tracking software online to get started. As your company grows, you may need to hire a stock control manager.

Step 9: Meeting Safety Regulations and Ensuring Industry Compliance

Although the manufacturing business examples in this guide serve different market segments, any manufacturing facility will need to abide by certain regulations.

Familiarize yourself with industry standards for your manufacturing processes and occupational safety regulations for your employees. As you build and scale your business, these will become even more relevant.

Getting Funding for Your Small Manufacturing Business Ideas

Even with the best manufacturing business ideas, you’ll need funding to build and scale it.  E-Boost Partners facilitates access to various business loans and financial services to help you realize your business dreams.

Every manufacturing business needs sufficient working capital. This is money used for day-to-day operations, paying short-term debt, purchasing inventory, and managing your liquidity while growing the business. We help you access term loans with terms of up to 24 months.

As your small manufacturing business grows, you’ll need more advanced equipment to scale your business. We help you obtain lines of credit, to meet these crucial needs.

Hassle-free payment processing is also essential in any business. Fortunately, E-Boost Partners provides high-quality merchant services. Our credit card processing services are efficient, affordable, and free of hidden fees. That’s how to streamline your payments and keep your customers happy.

Conclusion

The above list of manufacturing business examples highlights just a few potentially lucrative manufacturing business ideas. Allow your unique interests, experience, and expertise to guide your choice.

Becoming a success in the manufacturing industry takes time, patience, and hard work. Most importantly, it takes funding. E-Boost Partners offers access to this crucial resource.

We help small business owners get the working capital term loans and lines of credit they need for their businesses to thrive. And our merchant services help businesses provide customers with professional, efficient payment systems.

Contact us for more information about any of these financial products.

Is taking a new loan ever the answer to crippling debt? Sometimes it is. Many personal loan lenders offer consolidation loans. A credit card consolidation loan allows you to consolidate debt and gain control over your finances again.

If you’re new to debt consolidation, don’t despair. You’ll find all you need to know in this guide to debt consolidation, with recommendations for the 8 best debt consolidation loans of 2024.

What Is a Debt Consolidation Loan?

A debt consolidation or credit card consolidation loan is a personal loan that allows you to pay off existing debt with a lump sum. They can cover everything from credit card debt to store account debt, other personal loans, vehicle payments, and mortgages.

Credit card debt is one of the most common forms of debt that can quickly escalate. Fortunately, a credit card consolidation loan can help.

How Do Debt Consolidation Loans Work?

A credit card consolidation loan, or any other type of consolidation loan, covers existing debt with one convenient payment.

You will typically need a direct deposit bank account, not only to receive the loan amount but also to make that monthly payment. You may even qualify for a direct deposit discount.

A consolidation lender will supply you with the amount needed to pay off your unsecured debts and loans. And then instead of paying all those creditors every month, you’ll pay the consolidation lender with one payment, instead.

Therefore, a consolidation loan turns several smaller debts into one, larger debt, equal to the total of those original debts.

Typical Loan Amounts and Terms

The consolidation loan amount you apply for will depend on how much debt you have.

Loan amounts usually range from $1,000 to $50,000. However, the most typical consolidation loan amounts range from $10,000 to $20,000. Both maximum and minimum loan amounts vary between lenders, so you’ll need an estimate of the amount you need, before applying.

Your loan amount will reflect your total debt that is being consolidated. Monthly payments will be debited directly from your bank account. This can be a savings or checking account, as long as it allows the automatic monthly deduction of your consolidation loan payments.

Consolidation loans usually feature repayment terms from two to seven years. Ultimately, the amount you’re borrowing and what you can afford to pay each month will determine the loan terms.

Standard Debt Consolidation Loan Interest Rates

Interest rates may differ from one consolidation loan option to the next, but the average debt consolidation loan interest rate is about 26.11%. The last thing you need is to switch from high-interest debt to a high-interest consolidation loan!

Fortunately, low-interest loans for debt consolidation are available. However, factors unique to each case, particularly the credit score, can have a major impact on the loan rate.

How Credit Score Impacts Loan Rates

Credit scores matter. Your business credit score impacts both your interest rate and the chances of approval of your business loan. Your personal score also influences the approval of a personal loan or credit card debt consolidation loan.

Make sure you’re aware of what the interest rate will be before accepting an offer of loan funding. Any type of loan, including a consolidation loan, will typically have higher interest rates for bad credit scores.

But there’s one more thing you need to know about interest rates. They can be fixed, or variable. A fixed-rate loan has a fixed (unchanging) interest rate throughout the life of the loan. On a variable-rate loan, the interest rate fluctuates according to changes in market interest rates.

Most debt consolidation loans feature annual percentage rates that are fixed, so you’ll pay the same every month. This is in stark contrast to the variable rates of most credit card debts. But even if fixed, your fate may be influenced by your credit score.

Credit Card Consolidation Loan Overview

If you’re struggling to cope with credit card debt, a credit card consolidation loan is the solution. The sooner you get help with managing your debt, the better.

Here are the eight best consolidation loans to consider.

E-Boost: Best Overall

E-Boost Partners is the best place to get any type of loan. It’s the first stop for small business consolidation loans, working capital, and lines of credit, too. Some of these loans carry rates as low as 0.5%.

E-Boost Partners makes loan applications fast and easy. You’ll get notified quickly if you’ve been approved, and funds are often paid out within 24 hours of approval.

E-Boost is not a lender, but a team of professional loan brokers and experts committed to helping small-to-medium-sized business owners get the funds they need. With E-Boost, you can rest assured that only legitimate and trustworthy lenders will be recommended to you.

SoFi: Best Loan Amount Range

A credit card debt consolidation loan from SoFi allows you to transfer high-interest credit card balances to a personal loan from $5K-$100K. SoFi offers one easy monthly payment with a reduced APR and no other fees. Choose their Direct Pay option, and SoFi will pay your creditors directly.

Besides consolidating debt, SoFi also offers other benefits with an eligible cash management account and is also an equal housing lender. This means they can issue mortgages and refinance mortgages.

Upgrade: Best for Fair Credit Consolidation

Although an excellent credit history and credit score make it easier to apply for a loan, consolidation loans for fair credit are also available.

With a debt consolidation loan from Upgrade, fair credit borrowers can consolidate their debt with loans of up to $50,000, and improve their credit history simultaneously.

Avant: Best for Improving Creditworthiness

Don’t despair if you have a lower credit score. Avant provides fixed-rate debt consolidation loans for all credit scores, including poor credit scores. Avant offers personal loans to use for debt consolidation from $2,000 up to $35,000. The loan terms range between 24 and 60 months.

Avant reports to multiple credit bureaus. So if you manage your loan repayments well, this can improve your creditworthiness.

Upstart: Best for Low Credit Score

It’s difficult enough to get credit with a limited credit history. So, what can you do if you have minimal credit history, but need a consolidation loan? Try Upstart, the best option for borrowers with limited credit history.

You can get an Upstart debt consolidation loan with a credit score minimum of just 300. That makes this one of the best debt consolidation loans for poor credit.

Jenius Bank: Best for No-Fee Consolidation

Jenius Bank gives personal loans with no extra fees that can be used for credit card debt consolidation. Jenius’s Personal Loan amounts range from $5,000 to $50,000 and fixed APRs from 9.49%  to 23.49% (at the time of writing).

Your approved loan amount and term and credit profile, among other factors, will determine your APR within that range.

Citibank: Best for Borrowers with Excellent Credit

At CitiBank, you can apply for a personal loan to consolidate your debts. There’s no origination fee and you’ll have a fixed APR of between 11.49% and 20.49%. Your APR will be determined by several factors, including your credit score.

The lowest rate applies in cases of excellent credit, with a loan term of 24 or 36 months. But there are repayment terms of up to 60 months.

Reach Financial: Best for Customizable Funding

With Reach Financial, you’ll have access to quick funding with customizable monthly payment amounts. Personal loans range from $3,500 – $40,000 and can be used for debt consolidation. They offer flexible terms between 24 and 60 months, with APR rates from 5.99%-35.99%.

How to Get a Debt Consolidation Loan

Some, but certainly not all consolidation debt lenders are listed on the Better Business Bureau. Although this is a good place to start, you should do more comprehensive online research to find options that best meet your needs.

Select the Best Debt Consolidation Loan for Your Unique Needs

There are different types of debt consolidation loans and different debt consolidation lenders to choose from.

To make the selection that is right for you, consider the approval requirements, loan amounts, interest rates, and fees before making a decision. It’s a lot easier to get a debt consolidation loan with a good or even a fair credit score.

Getting a debt consolidation loan with bad credit is possible, although your options will be limited. If you have a low credit score, this should be the first thing you check when deciding on a consolidation lender — do they accept bad credit borrowers?

Practice Responsible Debt Consolidation

A debt consolidation loan allows you to pay off existing debts in one convenient payment. It can also save money, as consolidation lenders may offer you a more affordable monthly payment than you were previously paying for multiple debts.

However, don’t forget that meeting your debt payment obligations with a debt consolidation loan is as important as any other type of loan. Make your required monthly payment on time. And if you can make extra payments, do so. It will help you to pay off your loan early and get out of debt faster.

Debt Consolidation Loan Alternatives

Here are a few alternatives to conventional debt consolidation and credit card consolidation loans.

401(k) Loan

You can borrow money from your retirement savings, with a 401 (k) loan. Take note that this will have to be rapid, with interest, like any other loan. But you won’t need an exemplary credit history or high credit score. The maximum you may borrow is 50% of the 401 (k) balance, but never more than $50,000.

Note that a 401(k) loan could have significant tax implications if you fail to repay it on time.

Debt Management Plan

As with debt consolidation, a debt management plan lets you make a single monthly payment covering all of your unsecured debts. It’s not a loan, though, and won’t allow you to pay less than the original amounts you owe. You can get advice about a debt management plan from a consumer counseling agency.

Home Equity Loan

Home equity loans allow homeowners to borrow money against the equity in their homes. The equity is the difference between the property’s current market value and the homeowner’s mortgage balance. It is therefore a type of second mortgage you can use to pay off your other debts.

The Benefits of a Debt Consolidation Loan

With a credit card consolidation loan, you can enjoy the following benefits:

• You’ll have one convenient payment instead of multiple payments. This is much easier to manage and lets you feel in control of your finances.
• You may get a potential interest rate reduction. This means more of your payments will go to paying off debt, and less to interest on that debt.
• The total monthly payment is often lower than the previous total of separate payments. So you will find paying your debt easier, even on a tight budget.
• By collating all of your debt into one loan, you reduce the credit usage portion of your credit report. This can lead to an improved credit score.

How to Find a Debt Consolidation Loan with E-Boost

Are you looking for a debt consolidation or credit card consolidation loan for your small business? E-Boost partners can help. Term loans of 2-4 years can help you sort out your debt hassles or scale your business.

If you are unsure of what you need to manage your debts and get your small business back on track, speak to one of our representatives. Contact E-Boost Partners directly or book an appointment to get more information about the range of services on offer.

Conclusion

If you’re struggling to stay on track with debt repayments, you need a credit card consolidation loan.

A consolidation loan takes the pressure off with a lump sum to pay your debts. Instead of making multiple payments every month, you’ll just have one. And because some lenders offer lower interest rates for good credit, you could save money while mastering your debt.

E-Boost Partners is dedicated to helping small to medium business owners access the funding they need at competitive rates. Thanks to the simple application and approval process, your funding problems could soon be over.

Contact us today for more information.

Do you have an unexpected personal or business expense? A short-term loan is often the solution. However, a lack of credit history or a bad credit score can hold you back.

If this sounds like you, you’re not alone. Many people struggle to access the funds they need due to unimpressive credit reports. Indeed, it is such a common problem that a U.S. government website offers advice on how to check your credit report.

Fortunately, there are options for bad credit borrowers. In this article, we examine different types of short-term loans for bad credit. We also offer expert advice on how to avoid getting scammed by illegitimate lenders.

What Is a Bad Credit Score?

A credit score is a three-digit number that rates your creditworthiness as either good or bad. When it is low (bad), it can affect the likelihood of loan approval.

Credit score ranges can vary significantly depending on the credit scoring model used and the credit bureau with whom the lenders check your score. However, most lenders (including mortgage lenders) tend to rely on the FICO scoring model.

FICO scores range from 300 to 850. Scores higher than 670 are generally considered good. Therefore, anything lower is a bad credit score. And the lower that number is, the harder it is to be approved for credit or get a loan.

Businesses Have Credit Scores Too

Credit scores don’t only apply to individuals. Businesses have them too. So, what happens if you are a new business, with minimal credit history? In this scenario, your personal credit score is more important when applying for a short-term business loan.

A bad credit score makes obtaining funding difficult. Fortunately, bad credit short-term loans are available for people with low credit scores. Tackle that bad credit score with our step-by-step guide to building better business credit.

What Is a Bad Credit Short-Term Loan?

Sadly, the people with low credit scores are often the ones in the greatest need of credit or a loan. This is why short-term loans for bad credit exist. These loans meet immediate urgent financial needs. However, they have to be repaid within a few weeks up to 12 months.

Most short-term loans have terms of 3-6 months.

Where to Find Bad Credit Short-Term Loans

There are three main options for finding short-term loans for bad credit. These are credit unions, banks, and online lenders. Let’s look closer at them.

Credit Unions

Credit unions are financial cooperatives that offer many traditional banking services, including personal loans, business loans, and short-term loans for bad credit borrowers. They generally charge lower interest rates and fees than traditional lenders like banks.

Banks

Banks are traditional finance institutions that most people turn to first when looking for loans. However, it can be very difficult to get approved for a loan with a bad credit score. Whether you’re looking for a personal loan or a business loan, banks typically have stringent requirements.

You’ll need a valid bank account into which the loan amount can be paid, and from which to make your repayments. It helps if you have a bank account at the institution where you are applying for a loan.

Online Lenders

Online lenders are becoming a popular way to access short-term loans for bad credit. They often help people with loans when banks will not. However, they offset the risk of lending to people with minimal credit history or poor credit scores by charging a high interest rate.

Find a Bad Credit Short-Term Loan With E-Boost

Researching, applying for, and waiting for approval of loans can be daunting. Dealing with banks and credit unions is often stressful because you’ll have to meet stringent eligibility criteria. A good credit score is usually one of the most important of these criteria.

Online lenders make the process as painless as possible, and typically with fewer hurdles to loan approval. However, it’s difficult to know who to trust.

Luckily, you don’t have to go through any of that. Find a bad credit short-term loan with E-Boost Partners. We help individuals and small businesses find a variety of loan offers, including short-term loans for bad credit.

E-Boost will help you find loan offers that are right for your needs. So you can rest assured that you’re applying for a loan at a reputable lender. What’s more, the application process is quick and the approval wait time is noticeably shorter than with traditional lenders.

Types of Short-Term Loans for Bad Credit

There are different types of short-term loans for bad credit. Some of these are offered as personal loans, and some are business loans for bad credit.

Unsecured Loan

An unsecured personal loan does not require you to put up collateral. This is good news, as you don’t stand to lose any assets if you default on the loan. That said, it is more difficult to get a short-term loan without collateral when you have a bad credit rating.

Unsecured loans include both revolving and term loans and may be the solution you’re looking for. Check our guide to secured vs undecided loans if you still can’t decide.

Payday Loan

If you’re having no luck getting approved for bad credit personal loans, you could try a payday loan. These are short-term loans repaid with your next paycheck. As always, the amount you can borrow depends on what you earn. However, only small amounts are possible with payday loans.

Many lenders offering payday loans don’t require a credit check for approval, so a low credit score is not a problem.

Cash Advance

Do you need access to cash fast without applying for a loan? An Amazon merchant cash advance, one of the Amazon loans on offer to their online sellers, may be the answer. This facility is available to small business owners on the platform and is based on their past sales and the projection of future sales.

Not an Amazon seller? There are other types of cash advances. Credit card issuers usually offer cash advances if you have a business credit card.

How to Compare Short-Term Loans for Bad Credit

When comparing online loans, remember that repayment terms must be affordable. Consider not only the monthly repayments on the principal amount but also the interest charged. This can vary widely between loan types and lenders.

Some short-term loans for bad credit won’t charge much interest. However, most will, as borrowers with bad credit scores are seen as high risk for late or non-payment. Secured loans will have less interest. However, you will then face a higher risk, because non-payment could result in forfeiture of assets.

Compare the loan options available to you. Take note of which options have the most favorable terms and interest rates. Some lenders report to credit bureaus too. By making your monthly payments on time, you will boost your credit score.

How Your Loan Term Is Determined

Lenders who offer short-term loans for bad credit are understandably concerned about the risk of non-payment. Therefore, they consider various criteria when deciding on loan terms. Most often, this includes the borrower’s credit score, credit history, payment history, and existing debt-to-income ratio.

Based on these and other pertinent factors, such as how much you want to borrow, a lender will determine the most favorable terms. They know that the longer they give you to pay them back, the more likely they will get paid in full.

How to Identify Short-Term Loan Scams for Bad Credit

Too many people have been scammed by online lenders offering loans for borrowers with bad credit. Don’t let it happen to you. The lender behind any type of loan, even a bad credit loan, is subject to rules and regulations. This is easier said than done, however. Scammers often fool people with websites that look authentic.

A reputable lender will have a proper website and its own domain name. They will have contact details and often a physical address listed on their website. They may also feature reviews from satisfied customers.

Scam websites may not have their own domain name. Even if they do, other clues will alert you to potential problems. For example, you may find very little information and incomplete contact details on the website.

Three Telltale Signs

Admittedly, a dearth of information online might not necessarily be hard evidence of shady dealings. However,  there are three telltale signs that a lender is not all they appear to be.

• Upfront fees. Origination fees may be charged on some types of short-term loans, once the loan is approved. It is often included in the monthly payments. However, no reputable lender will charge you an origination fee before approval.
• Too-good-to-be-true promises. If it looks too good to be true, it probably is. So when a lender guarantees you a business loan for your brand new business, with no credit history and bad credit, it’s ]unlikely to be true.
• Very low interest rates. This is highly unlikely because firstly, most short-term loans carry higher interest rates. Secondly, bad credit borrowers present a higher risk, which in turn incurs higher interest rates on your monthly payments.

Conclusion

Are there short-term loans for bad credit? Yes, there are. You have several options to choose from. However, a poor credit history or low credit score often means paying higher interest on short-term loans. It also makes you vulnerable to disreputable lenders who are out to make a quick buck at your expense.

You can avoid all the hassle and uncertainty by applying for a short-term loan or a line of credit through E-Boost Partners. We help people access expert advice and legitimate loan offers, even with insufficient credit history or a bad credit score.

Take control of your credit score and your financial health, today by contacting us for more information.

PayPal is a safe, convenient, and secure online payment system. It is used by online merchants worldwide. You may already use it for your business to manage inbound and outbound payments. What’s more, PayPal offers small business owners like yourself even more with PayPal Credit.

Is this the financial lifesaver that it seems to be? Should you use it for your business purchases and payments? Read on to learn how to use Paypal Credit for your business, plus the pros and cons of doing so.

What Is PayPal Credit?

The credit line from PayPal is reusable and can be used for online payments anywhere PayPal payments are accepted. Note that it is not the same as the platform’s debit or credit card or a Working Capital loan; This is a virtual line of credit.

If approved, you can use it right away. No interest will be charged on purchases of $149+ if paid in full within 6 months. There is a minimum interest charge of $2.00.

How Does It Work?

You will need a PayPal account to access this line of credit. Though terms and conditions may apply, signing up for an account is free. If you already have an account and your credit line application is successful, it will automatically be linked to your account.

When you make an online purchase, simply select PayPal Credit as your payment method at checkout.

Managing Your Account

You will receive an email from PayPal when your monthly statement is ready to view online. And for added convenience, you can also manage your account using the PayPal mobile app.

Once logged in on the app or website, you can view your recent transaction activity, set payment reminders, and pay the credit line installments. This allows you to manage your credit easily.

Making Payments

There are multiple ways to make payments.

• Pay in full with a once-off payment.
• Schedule automatic monthly payments towards the balance owed.
• Make payments from your PayPal account balance on PayPal.com.
• Pay from a linked bank account of your choice.
• Mailed payments are allowed.

Interest

If the balance is not settled in full within 6 months, you will be charged accrued interest at the New Account variable Purchase and Cash Annual Percentage Rate (APR). At the time of writing, the APR is set at 31.39%.

Late Payments

Don’t miss any scheduled payments, if you can help it. You will be charged a late payment fee. This applies every month that the minimum payment is not paid by the due date. The late payment fee will never exceed the minimum monthly payments required.

When It’s Paid in Full

If you have paid in full, you may continue to use your credit line without reapplying. You may also request a credit line increase, if necessary, by calling the customer service number on your monthly statements.

How to Apply for PayPal Credit

Applying for a line of credit with PayPal is quick and easy. Visit Paypal.com and create a PayPal account, if you don’t already have one. The account creation process is fast and free.

Once you have an account, or if you already have one, you can navigate to the PayPal Credit page on the PayPal site and apply. Fill in the requested details, and wait to hear if you have been approved. Then select how you wish to make your future payments.

Your new credit line will automatically be linked to your existing PayPal account. You can also link it manually.

How to Use PayPal Credit for Your Business

As mentioned earlier, you need to have a PayPal account. There are two options – a personal one, and a business one.

On a PayPal Business account, you also have access to PayPal Invoicing. So you can send professional invoices through Paypal (fees may apply). You can add applicable taxes and other details. Plus, you can also customize your invoices with your business logo and more.

Once you have a PayPal Business account, you can make and receive payments for your online business through PayPal as well as your PayPal credit account.

PayPal Credit Pros and Cons for Businesses

This PayPal finance product has both pros and cons. Consider these before deciding to use it for your business.

Pros

The Convenience of Buying Now and Paying Later

It gives you the freedom to make the purchases you need now and pay for them later. This is helpful when you have to make unplanned purchases.

Easy to Use

It’s very easy to use. Once linked to your primary PayPal account, you can use it to pay at any online store or business that accepts PayPal payments. Unlike EFT or credit card payments, there are no account numbers, card numbers, expiration dates, or PINs to enter.

Many Ways to Pay

There are multiple ways to pay your account,  from your primary PayPal account, online bank account, in-app, or even through the mail.

Interest-Free For 6 Months

If you pay your balance in full within 6 months, no interest is charged to your account. Therefore, if you know you will be able to pay it off in that time, you could potentially save lots of money in interest charges.

Cons

Only Available With a PayPal Account

It is available to Paypal customers only. This will be a problem if you are based in a country that does not support the platform, or if you cannot open an account for any other reason.

Geographical Issues

PayPal is accepted in over 200 countries/regions and supports 25 currencies. However, it is not supported in a few countries. And it is also not possible to link PayPal to a bank account in several countries. This is not an issue in the United States.

Can Only Be Used Where PayPal Payments are Accepted

It can be used wherever PayPal payments are accepted, and there are countless such stores and businesses. However, PayPal is not accepted everywhere. And where PayPal is not a payment option, neither is PayPal Credit.

High-Interest Charges May Apply

There’s no interest if paid in full in 6 months. However, should you be unable to do so, high interest charges will be charged to your account from the purchase date. Unless you are certain you can pay it at that time and avoid the late fees and hefty interest charges, PayPal Credit may be unaffordable for you.

An Alternative to PayPal’s Line of Credit

PayPal offers a trustworthy and convenient line of credit that you can use for your small business’s unexpected expenses. However,  it is only useful when there’s an option to pay with PayPal. And that will not always be the case.

Don’t worry, there are alternatives to choose from. And at E-Boost Partners, we make finding these alternative solutions simple. With a quick and easy online application that takes just a few minutes, you can access working capital, lines of credit, and merchant services.

Conclusion

Paypal Credit offers a convenient way to make payments for online purchases. When linked to a PayPal Business account, it will give your business the tools it needs to make and receive online payments with ease.

However, other finance options are available for businesses. And you don’t have to take the risk of applying for loans with disreputable lenders. E-Boost Partners can help you find the best options and apply for them, online, in mere minutes.

Contact us for more details.

Running a business means constantly looking for ways to grow, whether launching new products, expanding operations, or navigating challenges. One of the best ways to stay on track is by raising capital for business.

With nearly 60% of small businesses reporting fair or poor financial conditions, securing funding is more important than ever.

In this guide, we’ll walk you through key funding options and strategies for raising capital to ensure your business thrives.

What Is Capital Raising?

Capital raising is the process by which businesses secure the necessary financial resources to fund day-to-day operations, growth, and expansion. These funds can be sourced from loans, investors, venture capital, or private equity.

For small businesses, raising capital is essential for covering operational costs, expanding services, or investing in new technologies.

For instance, studies show that about 29% of small businesses fail because they run out of capital. This makes it even more important to have the right funding in place to keep growing and thriving in a competitive environment.

Types of Capital Raising

There are two primary categories of capital raising for businesses: debt financing and equity financing.

Debt Financing

Debt financing involves borrowing money that must be repaid over time, usually with interest. Debt financing can take various forms, including traditional bank loans or lines of credit.

For example, small businesses can use their own financial resources or personal savings to raise capital for immediate operational needs like payroll, inventory, or supplier payments.

This option is attractive because businesses can access funds without giving up ownership. However, it requires a strong credit history and substantial financial statements to qualify, particularly with banks.

The repayment obligations can impact cash flow, but the clear payment schedule helps in planning and budgeting for ongoing operational needs.

Equity Financing

Equity financing lets you raise capital by selling shares of your business to investors, which includes venture capital firms, private equity funds, or angel investors. This approach provides necessary funds without adding debt to your balance sheet, easing cash flow pressures.

Although there are no direct repayments, equity financing does require giving up some control and sharing future profits.

This option is useful for high-growth companies, as investors often bring industry expertise, valuable connections, and additional resources to fuel expansion. For small businesses looking to scale rapidly, equity financing offers a smart and strategic way forward.

How to Raise Capital for Your Business: 6 Key Options

Capital raising is essential for helping your business grow and stay competitive. Here are six options to help your business thrive.

1. Bank Loans

Traditional bank loans remain one of the most accessible and structured forms of financing for established businesses. Banks offer both short-term and long-term loans that can be tailored to a business’s specific needs, from equipment purchases to working capital.

However, obtaining a bank loan requires a strong credit history, solid financial statements, and a detailed business plan to showcase the viability of the business.

The benefit of bank loans lies in their clear repayment terms and competitive interest rates, making them a solid option for businesses seeking reliable and predictable funding.

2. Small Business Administration (SBA) Loans

SBA loans are designed to make capital more accessible to small businesses. These loans are partially guaranteed by the government, reducing the risk for lenders and opening opportunities for businesses that may not meet the stringent requirements of conventional bank loans.

SBA loans can provide substantial amounts with favorable interest rates. They are often used by small businesses to fund major projects or cover significant operational expenses.

On the other hand, SBA loans may have more complex application processes and longer approval times.

3. Online Lenders

When it comes to raising capital for business, many entrepreneurs rely on flexible funding options like lines of credit. These products are designed to help manage cash flow, cover short-term expenses, and support growth without committing to long-term loans.

Raising capital for a business in this way provides immediate access to funds, ensuring that companies can keep their operations running smoothly – especially when unexpected expenses or seasonal fluctuations arise. By securing such funding, businesses can focus on their growth and day-to-day activities without financial disruptions.

4. Business Credit Cards

Business credit cards can serve as a flexible way to manage short-term expenses and immediate cash flow needs. With a business credit card, owners have instant access to funds for operational purchases, equipment, or even small projects.

But it’s important to note that while business credit cards are a convenient financing tool, they typically come with high interest rates if balances aren’t paid off monthly. Businesses should use credit cards carefully to avoid accumulating debt.

When used strategically, business credit cards can help manage short-term expenses without a complex loan application.

5. Angel Investors and Venture Capitalists

For businesses with significant growth potential, angel investors and venture capitalists can be a valuable source of equity financing. These investors provide funding in exchange for an ownership stake in the business.

They often bring industry connections, mentorship, and strategic advice that can help accelerate business growth.

But working with investors also means sharing control and future profits. Venture capital funding is often targeted toward startups and high-growth companies in need of substantial capital for scaling, while angel investors may work with small businesses seeking to bring innovative products to market.

6. Crowdfunding

Crowdfunding offers a fresh way for businesses to raise funds from many supporters through platforms like Kickstarter, Indiegogo, or GoFundMe. It’s useful for startups, creative projects, or consumer-focused products looking to attract backers without traditional credit requirements.

While accessible to a wide range of businesses, successful crowdfunding often hinges on effective marketing and a compelling narrative to capture public interest and build momentum.

Best Practices for Raising Money for a Business

To successfully raise capital, businesses need to approach funding strategically. Here are some best practices:

Develop a Comprehensive Business Plan

An effective business plan is vital for attracting lenders and investors to raise capital. It should outline your business’s goals, market strategy, financial projections, and growth plans.

Professional advisors, lenders, and investors look for material information that demonstrates how your business will generate profits. A well-structured business plan showcases your credibility and acts as a roadmap for long-term success.

Build and Maintain Good Credit

Building and maintaining good credit is essential for accessing favorable financing options when raising capital for your business. A solid credit profile not only increases your chances of securing loans or lines of credit but can also lead to better loan terms and lower interest rates.

By consistently paying bills on time and managing debt responsibly, you make it easier to raise the capital you need for growth. This proactive approach can also improve your ability to navigate future financial opportunities, giving you more flexibility when pursuing funding options down the line.

Calculate Your Capital Needs

Before you raise capital, it’s crucial to calculate the exact amount needed and the specific purposes for which it will be used. This careful planning ensures that you raise the right amount without risking overborrowing, which could strain your business’s finances.

A clear funding target simplifies the process of choosing between different financing options, whether through debt or equity.

Network With Investors

Establishing connections with high-net-worth individuals or angel investors can open doors to valuable resources and guidance for your business.

Attending industry conferences and networking events can increase your visibility and improve your chances of securing investment. Many investors appreciate the potential for high returns, making your network invaluable when trying to raise capital.

Prepare Financial Statements

Accurate and up-to-date financial statements are essential when approaching lenders or investors to raise capital. These documents provide a snapshot of your business’s financial health, including cash flow, revenue, and profitability.

Transparent financials build trust and demonstrate your commitment to financial discipline, which helps investors or lenders make informed decisions.

Explore a Range of Funding Sources

It’s smart for small businesses to explore multiple financing options. A couple include private equity firms and investment banks. Partnering with a private equity firm, for example, can provide both capital and business expertise.

Meanwhile, investment banks can help secure larger funding rounds or strategic support. By diversifying your funding sources, you’re better positioned for growth and can tailor financial support based on what’s best for your business now and down the road.

Final Thoughts

Capital raising is essential for growing a small business. Even if you pursue a bank loan, venture capital, or self-funding, knowing the pros and cons of each can make a big impact. It will ensure sustainable growth without compromising your long-term goals.

Plan carefully, establish a strong financial base, and follow these best practices to boost your chances of securing funds. Each capital-raising option has its strengths. Choose the one that best suits your business’s goals, financial health, and vision.

Ready to explore your options? E-Boost Partners is ready to assist you on this journey. Our financial experts provide tailored advice to help you secure the resources your business needs. Contact us today to start building your business’s financial future!

When it comes to cash flow, running a business is a balancing act. This makes it crucial to have access to flexible funding options. According to a survey by QuickBooks Study, 61% of small business owners struggle with cash flow challenges, making it a critical issue they need to manage effectively.

It affects their ability to grow and sustain operations payroll, manage inventory, or deal with unexpected expenses. A working capital loan can help bridge the gap.

But what exactly is a working capital loan, and is it right for your business? In this guide, we’ll explore everything you need to know, from the types of working capital financing to how they work and when they benefit your business.

What Is a Working Capital Loan?

A working capital loan is a form of short-term financing for covering the day-to-day operational expenses of a business. Unlike a long-term loan or a line of credit, this type of loan is not typically used for large investments or assets. Instead, it helps cover recurring costs, like rent and inventory.

Acquiring a working capital loan can ensure that business operations run smoothly when revenue may not be as high as usual.

For instance, businesses that experience seasonal sales patterns, like retail shops, rely on working capital loans to manage higher expenses during peak seasons.

Access to additional funds, such as through a loan or a line of credit, can be crucial for building up inventory, paying staff, or managing overhead costs. This ensures that these businesses are well-prepared to meet customer demand.

Secured vs. Unsecured Working Capital Loans

Working capital loans can be classified into two main types: secured and unsecured.

A secured working capital loan requires collateral – such as equipment, real estate, or inventory – to back the loan. This collateral serves as security for the lender, often resulting in lower interest rates. However, it also means that the borrower’s assets are at risk if they fail to meet repayment terms.

Conversely, an unsecured working capital loan does not require collateral, making it an attractive option for businesses that may not have valuable assets to pledge. However, due to the increased risk for lenders, unsecured loans typically carry higher interest rates and may come with stricter qualification requirements.

Business owners should take the time to weigh the benefits and risks of each option before settling. It’s also a good idea to think about how a line of credit could play into their overall financing strategy.

How to Calculate Working Capital

Calculating working capital is a crucial step for any business considering a loan. The basic formula is:

Working Capital = Current Assets – Current Liabilities

This calculation helps determine if a business has enough short-term assets to cover its short-term liabilities. A positive working capital figure indicates that a business is in good financial health and can meet its obligations, whereas a negative working capital suggests potential cash flow problems.

A business with $100,000 in current assets and $80,000 in current liabilities has a working capital of $20,000. Lenders often assess a company’s working capital ratio (current assets divided by current liabilities) to gauge financial stability.

Generally, a ratio between 1.2 and 2.0 is considered healthy for most industries. However, benchmarks can vary based on sector specifics.

How Does a Working Capital Loan Work?

Once a working capital loan is approved, funds are disbursed to the business for immediate use. The structure of working capital loans is typically short-term, with repayment periods ranging from six months to three years, depending on the lender and the loan type.

Some working capital loans require fixed monthly installments, while others may be more flexible. This could include a revolving line of credit that allows businesses to draw funds as needed.

Interest rates on these loans vary widely based on the lender, the borrower’s credit profile, and whether the loan is secured or unsecured. A traditional loan often requires regular fixed payments, whereas a line of credit enables businesses to access funds when necessary, paying interest only on what they use.

Types of Working Capital Loans

There are multiple types of working capital loans available, each with its benefits and considerations.

Term Loans

A term loan provides a lump sum that the borrower repays in fixed installments over a set period. This option is ideal for businesses needing a specific amount of capital to cover immediate expenses.

Terms and interest rates can vary widely, depending on the borrower’s creditworthiness and whether the loan is secured or unsecured.

Term loans offer predictability in repayment, beneficial for budgeting and financial planning. However, once the funds are fully disbursed, the borrower must complete repayment before reapplying for additional financing. This type of loan is commonly available through banks, credit unions, and online lenders.

Business Lines of Credit

A business line of credit offers a more flexible financing solution, allowing businesses to access funds as needed, up to a specified limit. Borrowers only pay interest on the amount they use, making it a cost-effective option for businesses facing variable expenses or seasonal revenue changes.

Many businesses with fluctuating cash flows find lines of credit advantageous since they can borrow as necessary to cover shortfalls. Repayment terms are flexible, often with interest-only options available during the draw period, after which principal payments may be required.

A line of credit can serve as a financial safety net. It gives businesses the confidence to take on new projects or manage unexpected expenses without compromising cash flow.

Commercial Loans

A commercial loan is typically used for larger-scale business expenses, but it can also serve as working capital in certain situations. These loans, provided by banks or financial institutions, usually require a strong credit history and extensive documentation.

Commercial loans may be secured or unsecured and generally come with competitive interest rates for qualified businesses. Due to their larger loan amounts, commercial loans tend to be more rigid in terms of qualification requirements and approval times.

However, they can be ideal for businesses with substantial cash flow needs or established businesses looking to expand.

SBA Loans

The Small Business Administration (SBA) provides government-backed loans, such as the SBA 7(a) program, which can be used for working capital purposes.

SBA loans are known for their competitive rates and favorable terms, making them a popular choice for small businesses that qualify. In fact, the SBA reached nearly $43 billion in funding for small businesses in 2022, approving over 62,000 traditional loans through the 7(a) program.

However, SBA loans require a more extensive application process and generally take longer to obtain. The SBA’s guarantee to lenders reduces their risk, allowing them to offer more beneficial terms to small businesses.

Because of the successful interest rates and repayment schedules, SBA loans are an excellent choice for businesses seeking long-term stability and manageable payments.

Where to Get a Working Capital Loan

Working capital loans can be obtained from various sources. Here’s a look at some of the most common options:

Banks and Credit Unions

Traditional banks offer competitive rates, especially for established businesses with strong financial records. While banks tend to have stricter eligibility requirements, they can be a good fit for companies with a positive credit history and sufficient documentation.

Business credit cards and term loans are often available through these institutions. For businesses with a strong relationship with their bank, this route can offer stability and support for larger financing needs.

Online Lenders

Many online lenders provide quicker approval times and more lenient qualification standards than traditional banks.

While online options can be faster and more convenient, they often come with higher interest rates. These loans can be helpful for businesses needing fast working capital loans to cover urgent expenses.

Online lenders also offer flexible repayment terms, allowing businesses to choose options that best fit their cash flow.

Alternative Financing Companies

Some businesses turn to alternative financing options, such as invoice financing or merchant cash advances. These options provide working capital by advancing funds based on expected future revenue, making them ideal for businesses with irregular cash flow patterns.

Invoice factoring, for instance, allows businesses to borrow money against their receivables, improving immediate cash flow.

Merchant Cash Advance Providers

Merchant cash advances (MCAs) offer businesses a lump sum in exchange for a portion of future sales, often deducted daily from credit card transactions.

For example, a café needing $10,000 for new equipment might receive it as an MCA, repaying a portion of daily credit card sales over time.

This type of financing is fast and doesn’t require strict credit qualifications, making it suitable for businesses with strong daily credit card sales. However, MCAs often come with higher costs due to frequent repayments.

When Is a Working Capital Loan Right for Your Business?

While working capital loans can provide essential support, they’re not always the best solution for every business. Here is what you should bear in mind:

Seasonal Cash Flow Variability

For businesses that experience seasonal highs and lows, like those in retail, agriculture, or tourism, managing cash flow can be a challenge.

When peak seasons roll around, companies often need to ramp up operations to meet increased customer demand. This can involve building up inventory, hiring temporary staff, or investing in marketing campaigns to attract more business.

That said, cash flow can take a hit during off-peak times, making it tough to cover ongoing expenses such as rent, utilities, and payroll. This is where a working capital loan can make all the difference.

For example, a clothing store gearing up for the holiday shopping season might utilize a working capital loan to purchase additional inventory. This financial support allows them to meet customer demand and keep shelves stocked without putting undue stress on their cash flow.

Expansion Opportunities

Rapid growth can bring exciting prospects, but it often requires a solid financial foundation to seize them. Businesses looking to expand need to invest significant resources upfront, whether they’re launching new products, entering new markets, or enhancing their infrastructure,

Working capital loans can provide the necessary financial backing to facilitate this growth without disrupting day-to-day operations.

For instance, a tech startup may find itself with the chance to enter a lucrative market but lacks the immediate cash flow to fund the necessary research and development. By obtaining a working capital loan, they can invest in product development, hire skilled personnel, and execute marketing strategies to capture market share.

This financial flexibility is crucial for businesses aiming to stay competitive. A working capital loan allows companies to act swiftly on growth opportunities, making it possible to achieve their goals without the constraints of limited cash flow.

Short-Term Cash Flow Gaps

Even well-established businesses can encounter unexpected cash flow gaps. Delayed client payments, unforeseen expenses, or fluctuations in sales can create short-term financial challenges. Having a reliable solution to cover immediate expenses is essential during these times.

For example, a construction company awaiting payment from a client may need to cover payroll or equipment rentals in the interim. By utilizing a working capital loan, they can ensure their operations continue smoothly while waiting for funds to arrive.

This type of financing not only helps businesses manage day-to-day expenses but also allows them to maintain their reputation and relationships with employees and suppliers. Being able to meet financial obligations on time fosters trust and reliability, which are crucial for long-term success.

Conclusion

Working capital loans can be a great option for small and medium-sized businesses to keep operations steady and manage cash flow needs. They help bridge the gap between expenses and income, letting you focus on growth and stability.

When exploring working capital loans, it’s important to review different options. Each lender has its own terms, rates, and fees. So, a little research can go a long way. Working with a trusted lender can help you find the right fit for your business.

With the right working capital solution, you’ll be ready to handle financial ups and downs and seize new growth opportunities. Luckily for you, E-Boost Partners can help ease this process. Reach out to our team today, and let’s find the loan that fits!

Your working capital indicates how much money you have to work with between your current assets and liabilities. But to know your business’ true financial health and liquidity status, you need to know your working capital ratio.

Do you know how to calculate your working capital ratio, and why it’s so important for your business? What is an ideal ratio and what to do to reach it?

Read on for the answers to these questions and much more.

What is Working Capital Ratio?

Working capital, or net working capital, is the difference between the current assets and current liabilities on a company’s balance sheet. It indicates short-term financial health and liquidity.

The working capital ratio is the liquidity equation. It determines the business’s ability to pay off current liabilities with available current assets. Once you understand what to look at, calculating it is quite simple.

How to Calculate Working Capital Ratio (WCR)

The current assets typically included in the calculation include:

• Accounts receivable/customers’ unpaid bills
• Cash
• Inventories – raw materials and finished goods

Current liabilities usually included in the calculation are:

• Accounts payable
• Debts

The Formula for Working Capital Ratio

Here is the basic working capital ratio calculation: WCR = Current Assets ÷ Current Liabilities

The current ratio is calculated by dividing the current or short-term assets by the current liabilities or short-term financial obligations.

Why Does the WCR Matter?

Showcases a Company’s Financial Health

When you know your WCR, you will have a clearer idea of your business’s financial health and liquidity. This will make it easier to make profitable business decisions. It will also improve your standing in business partnership negotiations.

Highlights Opportunities for Expansion

A higher WCR may indicate inadequate use of available funds. If you have excess or idle funds, you’ll know to start utilizing them more effectively. This can mean expanding the business, growing your team,  or investing in more stock.

Indicates Where Improvements Need to Be Made

A lower WCR may indicate financial difficulty and the inability to pay banks, vendors, and other creditors. This is an opportunity to address these issues, either with renegotiated vendor agreements or restructured/refinanced loans.

What Is a Good Working Capital Ratio?

How much working capital do you need to meet your payment obligations? Our research shows that a ratio of approximately 1.2 to 1.8 is considered a healthy, balanced ratio. For many, an ideal working capital ratio is closer to 2, as this indicates that the business can meet its financial obligations.

However, a ratio that is less than 1 can spell bad news for the company. This shows a negative working capital situation and indicates that the business is not financially healthy. Therefore, it is unable to meet its financial obligations and cannot afford to pay its current liabilities.

Is a High Working Capital Ratio Good?

A negative working capital ratio of less than 1 means your business may be in difficulty. If such a negative ratio continues, bankruptcy may be in the future.

Because a balanced working capital ratio closer to 2 is good, you may think a higher working capital ratio (above 2) is even better. But that is not necessarily true: a very high working capital ratio is a sign of excess and idle funds. It shows the business’s funds are not being adequately utilized.

How to Improve Net Working Capital Ratio

The difference between your current assets and current liabilities establishes whether or not you have a good or bad WCR. But there are a few things you can do to improve it.

Ensure More Accurate Accounts Receivable Numbers

Money coming into your business increases your company’s working capital. Accounts receivable are the funds you expect to receive from customers. Designated as current assets, they raise your WCR. But this is only useful if customers will pay what they owe you.

Enhance your screening of customers to determine who is a good candidate for a credit line. And improve your follow-up for unpaid accounts. Consider offering a discount for full settlement, or a cash payment. This will improve the odds of receiving what is due to you, and ensure more accurate WCR calculations.

Increase Your Inventory Turnover to Increase Cash Flow

Your inventory, the items you intend to sell in the next year or less, are current assets. Proceeds from sales increase working capital and improve your WCR. Of course, if you run a service-oriented business, this may not be a factor. But in a sales-oriented business, it matters a great deal.

Calculate your inventory turnover, and make any necessary changes to your inventory management. This will allow you to have enough of the type of stock that sells more, leading to an improved cash conversion cycle, with more potential sales, and working capital.

Reduce or Refinance Your Debt

Reducing or refinancing your debt reduces your current liabilities. This will have a positive effect on your WCR. We recommend that you research your loan options, to find more suitable terms or lower interest rates.

Take Out a Working Capital Loan

A working capital loan provides quick access to funding that covers short-term operational needs. It can improve your working capital cycle, and enable you to get your business back on track. If most of your business transactions are done through Paypal, you may qualify for a Paypal Working Capital Loan.

What Does The Working Capital Ratio Suggest About Liquidity?

A company’s liquidity is its ability to pay off its short-term liabilities (due in less than a year). The working capital ratio is, ultimately, a liquidity equation. It highlights a business’s economic health, and ability (or non-ability) to meet its financial obligations.

By doing the WCR calculation, you can determine your own business’s liquidity. If the result is low, take some of the steps above to increase your working capital and improve the ratio. If it is too high, consider making better use of your available funds by scaling up or expanding your inventory line.

How Does It Differ From Working Capital, Free Cash Flow, and Cash Flow?

To answer this, let’s look at what the terms cash flow, free cash flow, and working capital mean.

• Cash flow is the movement of money into and out of a company over a certain period. When the inflow exceeds the outflow, the cash flow is said to be positive.
• Free cash flow is, as the name suggests, the cash that remains free after capital expenditures and operating expenses. It excludes non-cash expenses from the income statement.
• Working capital is the difference between a company’s current liabilities and current assets.

Therefore, a working capital ratio is a liquidity calculation. While working capital shows the difference between liabilities and assets, the WCR shows the ability to pay off those liabilities with those assets.

Conclusion

A working capital ratio is an equation that expands on your knowledge of your working capital. It is a simple way to better understand your financial health. When you know how to calculate it, and what to do to improve it, you can take steps to enhance your business’s liquidity.

One of the best ways is to take a working capital loan. At E-Boost Partners, we help small businesses access various types of short-term loans to ensure a positive working capital ratio and more growth opportunities. Contact us today for more information.

You’ve probably heard that you need money to make money. These words are true. Extra money can mean the difference between expanding your business and growing its potential or caving under the weight of financial pressures.

If you are looking for ways to grow your e-commerce business, a short-term loan or Amazon seller loan might be the answer. Here are 9 top financing options to consider as an e-commerce business in need of a financial boost.

9 Financing Options for Your E-Commerce Business

Business Credit Cards

Business credit cards are popular because they are convenient and often easier to qualify for than traditional loans. 

You are likely familiar with personal credit cards. These have a predetermined credit limit that you can access to purchase goods, pay for services, and even draw cash. Interest is charged on what is spent, and the limit may be revised regularly, depending on how well the credit is managed.

Business credit cards operate in a similar way. However, they typically offer higher credit limits and include business-related perks such as building your business credit history. 

A Business Line of Credit

A business line of credit is a similar financial tool to a business credit card. It allows businesses to borrow the funds they need, up to a predetermined limit. The funds may be accessed through a business banking account or a mobile app, and interest is only paid on the funds used. 

An unsecured line of credit is usually not designated for a specific purpose or purchase. Therefore, it offers as much flexibility as a business credit card. However, the credit limit on a business line of credit is generally higher.

Inventory Financing

This is a short-term loan, but can also operate as a revolving line of credit, allowing you to borrow repeatedly without applying for a new loan. It is designated for use in purchasing stock, and the inventory purchase serves as collateral for the loan. 

You may apply for this type of financing from traditional banks, credit unions, or even online lenders. This type of Amazon seller loan may be your best bet if you don’t qualify for other more conventional loans or a business credit card. However, be aware that interest rates can be high.

There are other risks, too. You’re counting on selling those inventory items to have sufficient funds to repay the loan. If sales are poor, you won’t be able to make the payments. And your inventory could then be repossessed to cover the costs of the loan.

Revenue-Based Financing

Revenue-based financing is also known as royalty-based financing. It is a method of raising capital from investors, who receive a predetermined percentage of ongoing gross revenue in return for their funding.

This ensures that investors receive high returns, without you paying interest on the funds. Therefore, revenue-based financing is similar to equity financing, but with one major advantage: the investors have no direct say in, or ownership rights to,  the business. 

If you are new to e-commerce and unable to obtain other financing, this type of Amazon seller loan may still be an option for you. 

Short-Term Small Business Loans

Business financing options can be short or long-term. Short-term small business loans allow faster access to funds and are often much easier to qualify for than traditional long-term loans. These quick business financing options are available online and offer repayment terms of between three and eighteen months.

The speed and ease of application and payout are excellent advantages for borrowers who need quick cash flow for their businesses. But there’s a downside to this convenience: short-term small business loans often have higher interest rates than traditional loans.

SBA Microloan

The Small Business Administration (SBA) is a United States governmental agency. It provides entrepreneurs and small business owners with capital, contracting expertise, and financial counseling. Though provided by SBA-approved lenders, the government partially guarantees them as well.

The SBA microloan program caters specifically to smaller businesses, offering loan amounts up to $50,000. Interest rates on microloans range from 8 to 13%. You may even qualify if you have a low business credit score. 

If you are an Amazon seller who does not meet the eligibility requirements for Amazon Lending, an SBA loan may be the solution. 

Merchant Cash Advance

With a merchant cash advance, the lender advances your business the cash flow it needs to continue operating. This loan will be repaid with your future revenue. 

Merchant cash advances can be used for inventory purchases, shipping costs, or any other expenses related to running your e-commerce business. Therefore, they are a type of working capital financing. 

You won’t have stringent repayment terms or penalties for late payments on this type of Amazon seller loan. Repayments come out of your future Amazon sales until the advance is paid in full. No interest is charged on an Amazon merchant cash advance, and no personal collateral is required. 

Amazon Lending

Amazon sellers can take advantage of loans exclusive to Amazon sellers using the Amazon Lending program. The program offers various options, including a line of credit., term loans, and a merchant cash advance. If you’re an eligible Amazon seller, this may seem like the obvious answer to your financial woes. 

However, you can’t just initiate the application process at will. Amazon loans are accessible by invitation only. If you are new to the e-commerce platform or have not had impressive sales, you may not meet their eligibility criteria. 

E-Boost

Applying for financing to grow your e-commerce business can be stressful. You need to take the time to research what’s available and understand your options. Then there are the hurdles you have to jump through to meet lenders’ eligibility requirements. It can become overwhelming.

Fortunately, there’s another option: At E-Boost Partners, we help you get that financial boost you need for better business growth. We make it easy to apply for short-term financing for your e-commerce business.

E-Boost Partners can facilitate working capital arrangements of up to 24 months, offering between  $5K-$2M, with automatic daily or weekly payments. Lines of credit and affordable merchant services are also available, to cover all your e-commerce business’ financial needs.

How to Choose, and Use, Funding for Your Amazon Business

An Amazon business loan on the Amazon Lending platform, or any other type of business loan, will provide financing for your e-commerce business. But how can you know which one to choose? And how should you use it to grow your e-commerce business?

Choosing a Lender for Your Amazon Business

For small or medium-sized businesses involved in e-commerce on the Amazon platform, there are several types of Amazon seller loan to consider. If you qualify for an Amazon loan, they may extend an invitation to you. Alternatively, a traditional or alternative lender may be a better option to consider.

This means deciding between banks and credit unions on the one hand, and online lenders on the other. If you have a low credit score or are too new to e-commerce to have a credit history, the latter may be your best option. An SBA microloan could also work for you.

What if you don’t get invited to apply for a loan through Amazon lending, but are unsure of your best way forward? E-Boost Partners make it simple to apply for financing. You’ll enjoy a quick and easy application and approval process, and receive the funds you need, fast.

Using the Funds to Grow Your Amazon Business

Adequate funding is critical for your Amazon business’s success.  Here are three reasons why the right financing offer can make all the difference.

Operational Expenses

You can use the funds to cover your day-to-day and operational expenses while you establish yourself as a reputable seller on the Amazon platform. 

Inventory Purchases

Selling on Amazon can be lucrative, but highly competitive. The funds can be used for securing the best quality inventory and enough of it to meet demand and customers’ expectations. 

Marketing

Regardless of the quality of your products, it’s difficult to stand out from the crowd on the Amazon marketplace. To succeed, you need to market yourself effectively. The funds obtained from an Amazon seller loan can cover marketing costs, giving you a competitive edge. 

Conclusion

An Amazon seller loan can take many forms. If you have an e-commerce business that sells exclusively on Amazon, a loan through the Amazon Lending program may be your best bet for financing to grow your business. But if you don’t meet the criteria for Amazon’s invitation-only loans, there are other great options. 

At E-Boost Partners, we make it simple for small businesses to apply for e-commerce financing options like working capital loans and lines of credit. Whether you sell on Amazon or any other e-commerce platform, we can help you get the funding you need. 

Contact us to start growing your business today.